Corporate bankruptcies rose for an eighth month in January as the deepening recession weakened sales and made it harder for businesses to get funds.

Bankruptcies climbed 15.8 percent from a year earlier to 1,360 cases after increasing 24.1 percent in December, Tokyo Shoko Research Ltd. said Monday.

The increase in business failures may make banks more cautious about lending as the record drop in stock prices has depleted their capital.

The Bank of Japan said last week it will buy shares owned by financial institutions to encourage lenders to extend funds to companies amid what it predicts will be the deepest recession in the postwar period.

"The funding problems will, unfortunately, continue to weigh on companies through fiscal 2009," which begins April 1, said Mari Iwashita, chief market economist at Daiwa Securities SMBC Co. "It's unavoidable that an increase in bankruptcies and deteriorating profits will lead to higher credit costs."

The BOJ said it will buy up to ¥1 trillion worth of stocks owned by banks after deciding last month to purchase up to ¥3 trillion worth of commercial paper to channel funds to companies.

"The outlook for the economy is severe," BOJ Gov. Masaaki Shirakawa said last week. "Exports slowed very sharply in the fourth quarter and credit markets have tightened."

Japan General Estate Co., a property developer, Nakamichi Machinery Co., a construction machinery trader and Marui Imai Inc., a department store operator, all went bankrupt in the past two weeks.

The number of companies that registered for pre-emptive insurance for bankruptcies rose 45 percent to 27,171 in 2008, the biggest increase in 47 years, according to the Organization for Small and Medium Enterprises and Regional Innovation.