Japanese Consumer Loan Takefuji files for Bankruptcy

By on Sep 28, 2010 in Business, Finance, World Comments

A Japan-based consumer loan company files for bankruptcy, according to Japan Times.

Takefuji, a Japanese consumer loan giant filed for bankruptcy, sources told on the reports.

According to credit research firm Tokyo Shoko Research, the corporation said it had a debt of ¥ 433.6 billion ($5.1 billion, £3.2 billion), making it the biggest consumer loan company to face bankruptcy.

However, Takefuji President Akira Kiyokawa told Japanese reporters that the company will not seek court protection from creditors, contrary to media reports.

Meanwhile, the Tokyo Stock Exchange suspended trading in Takefuji shares, which was listed on its first section.

Reports also said the consumer loan company started having problems in January 2006, due to a court’s decision.

Takefuji, according to the country’s Supreme Court, should repay its borrowers after it was charged with alleged illegal interest rates.

The company then faced difficulties when borrowers began claiming refunds increased rapidly.

Takefuji used to be Japan’s fourth-biggest consumer loan company with ¥589.4 billion in outstanding loans as of the end of March, 2010.

But back in March 2002, their outstanding loan was then ¥1.7 trillion, when it was the largest money lender in Japan.

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