This grim report on Japan's banks mentions that Japan's fiscal year begins on April 1. The Year 2000 Problem will begin early in 1999 for Japan, Canada, and New York State.
Problem: Will companies facing bankruptcy, or fearful of bankruptcy, pay for y2k repairs?
This was a Reuters report (March 13).
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TOKYO, March 13 (Reuters) - Japan Inc is set to suffer a record level of bankruptcies in the business year ending this month and the situation may only get worse, a leading credit research firm said on Friday.
Total debts held by Japanese companies going bust will rise to 13.5 trillion yen ($104 billion) in the 1997/98 year to March 31, a record for the third straight year, Tokyo Shoko Research predicted in its monthly report. . . .
The number of corporate bankruptcies for the year is seen totalling 17,300, it said.
``The corporate business situation is getting harsher day by day,'' Rokuro Kuroda, a senior researcher at Tokyo Shoko, said.
He said the bankruptcy debt may swell to another record in the next fiscal year starting on April 1, possibly as high as 16 trillion yen. The number of bankruptcies may also grow to more than 20,000, he said.
Kuroda said the Asian economic turmoil would start to take its full toll, especially of firms heavily invested in the region, and the domestic economic climate remained fragile.
``The decline in the economy is accelerating, while bankruptcies are spreading into all sectors,'' Kuroda said. . . .
Analysts said the injection of public funds of about two trillion yen into the banking sector to help mitigate the crunch would do little to change the tight lending policy of Japanese banks. . . .
``The introduction of Japan's 'Big Bang' financial reforms could even make things worse,'' Kuroda said.
After Japan lifts restrictions on currency trading next month, banks may experience a rapid outflow of savings deposits from individual and corporate clients, he said.
Given Japan's ultra-low interest rates, people may tend to invest in overseas products with higher yields. Companies may also shift deposits to foreign banks from domestic ones, a move that would further increase banks' difficulty in raising money in the money markets and in turn make them more cautious about lending to companies, Kuroda said.