The failure of Pacific Holdings Co., a real estate manager that filed for bankruptcy protection with ¥163.6 billion in liabilities, highlights the funding problems at many firms.

The Financial Services Agency, the nation's financial regulator, in an unprecedented move, said Tuesday it will inspect banks between April and June and may penalize lenders found to have "viciously" cut off borrowers.

Pacific Holdings on Tuesday became the 12th publicly traded firm in Japan to fail this year as the global recession makes creditors wary of lending to smaller companies in favor of major names such as Panasonic Corp. and Mitsubishi UFJ Financial Group Inc. Bankruptcies rose for a ninth month in February.