The number of corporate bankruptcies fell below 13,000 in 2005 for the first time in 14 years, helped partly by a recovery in major companies' business sentiment, a credit research agency said Thursday.
The 12,998 corporate bankruptcy cases for the year is a drop of 4.9 percent from 2004, the fourth-straight yearly decline, according to Tokyo Shoko Research, whose data cover the failures of firms with debts of 10 million yen or more.
Besides the improvement in major companies' business, the agency attributed the fall to expansion of public financial support to small and midsize companies.
The debt left by failed firms was 6.70 trillion yen, down 14.2 percent from the previous year and falling below 7 trillion yen for the first time in 11 years. The size of the debt left by bankrupt companies has shrunk every year since hitting a record high of 23.89 trillion yen in 2000.
Banks forcing firms to liquidate was the main cause of corporate bankruptcies in 2005, according to Tokyo Shoko. Bankruptcies of companies with less than five employees accounted for 60 percent of the cases, the highest ratio in 15 years.
In December, the number of corporate bankruptcies rose 3.6 percent from a year earlier to 1,149, the third consecutive month of increase.