Proportion of Zombie Firms in Japan Falls as Bankruptcies Rise

The proportion of so-called zombie companies in Japan fell to 15.5% in the fiscal year through March 2024 as more businesses collapsed after failing to keep up with debt repayments, according to data from research firm Teikoku Databank.

• It was the first drop in the proportion of zombie companies in seven years, and the trend may continue, says Teikoku
• Borrowers’ repayment of no-interest and no-collateral Covid loans provided by private-sector and government-affiliated financial institutions had caused them to go out of business
  • Such loans had helped them stay afloat during the pandemic
• The Bank for International Settlements defines a zombie ...