Japan

Cabinet ministers have agreed to demand that Tokyo Electric Power Co. carry out deeper restructuring so it can secure enough compensation for damage caused by the Fukushima No. 1 power plant but were less certain on whether a new entity should be set up to help it, officials said, The Japan Times reported. The decision to set up the entity, which would provide funds to help the beleaguered utility known as Tepco pay for radiation-related damages, was delayed on Saturday.

The court-appointed administrator of failed consumer lender Takefuji Corp. said Friday he won't disclose details of the bidding process to particular bondholders due to confidentiality agreements, Dow Jones Daily Bankruptcy Review reported. Eiichi Obata, the lawyer charged with Takefuji's sale, said at a press conference he hopes bondholders would understand that the bidding process had proceeded under the guidance of the court and third party inspectors. He added that he would talk with creditors seeking their understanding.

Japanese industrial production and consumer spending dropped at their sharpest rates on record in March, the government said Thursday, underscoring the impact of the recent earthquake and tsunami and the continuing nuclear plant crisis on the nation's fragile economy, The Wall Street Journal reported. The latest data show how sharply the Japanese economy veered from its recovery track after the March 11 disaster disrupted the nation's supply chains, impaired nuclear power generation and darkened the mood among consumers.

The threat of a cut to Japan’s credit rating adds pressure on Prime Minister Naoto Kan to raise taxes as he wrestles with financing earthquake rebuilding without adding to the world’s biggest public debt burden, Bloomberg reported. Standard & Poor’s lowered its outlook yesterday to “negative” on Japan’s AA- local-currency rating, estimating that costs stemming from the earthquake, tsunami and nuclear crisis may boost budget deficits by 3.7 percent of gross domestic product through 2013.

The number of Japanese corporate bankruptcies is likely to rise after the summer on the impact from last month's devastating earthquake and subsequent tsunami, a research firm said on Friday, with the effects of government spending on disaster relief expected to take some time to filter through, Reuters reported. The number of bankruptcies fell 9.9 percent in March from a year earlier to 1,183 cases, with six attributed to the impact from the quake and tsunami, Tokyo Shoko Research showed.

Takefuji Corp. said Monday that it has granted South Korean consumer lender A&P Financial Co. preferential negotiating rights to take over the failed Japanese consumer lender in what would be one of the biggest acquisitions by a South Korean firm of a Japanese company, but the unexpected development is leading bondholders and a rival bidder to question the way the lender's court administrators have handled the sale process, The Wall Street Journal reported.

Japan Airlines on Wednesday said it is seeking 200 employees to volunteer for unpaid leave, as it tries to cut costs due to falling travel demand after the March 11 disasters and amid a nuclear crisis, Agence France-Presse reported. The appeal comes just after the airline finally moved out of bankruptcy following its spectacular collapse that led it to go cap-in-hand to the government. "Due to a drop in visitors and cutbacks in routes, we are seeking 200 pilots and flight attendants to volunteer for a month of unpaid leave," said Japan Airlines spokesman Taro Namba.

The Japanese government is considering financial aid to the troubled Tokyo Electric Power Co., or Tepco, through an injection of public funds or debt guarantees, a government official said Friday, The Wall Street Journal reported. "Unless the government takes such a step it will be difficult for Tepco'' over time to secure necessary capital, Masayuki Sudo, a spokesman for the Nuclear and Industrial Safety Agency, said in an interview Friday morning.

Japan Airlines Corp., once the world’s largest international carrier, is set to emerge from bankruptcy administration this week as a smaller company more reliant on Asian routes and global partners, Bloomberg reported. JAL has scaled back its global network, chopping 49 routes, including Sao Paulo, Amsterdam and Milan, and grounding the last remnants of what was the world’s largest Boeing Co. 747 fleet as it cuts 103 planes. The Tokyo-based airline, which holds its monthly press briefing at 5 p.m.

Japan Airlines Corp is expected to complete restructuring its business, under court guidance, on Monday, the Nikkei business daily said. After filing for bankruptcy protection in January, last year, the airline has tried to turn around, backed by Enterprise Turnaround Initiative Corp of Japan (ETIC), Nikkei said. Restructuring measures, including cutting workforce by 16,000, worked and operating profit for the nine months through December stood at of 158.6 billion yen, the paper reported. On Monday, the company is slated to receive 254.9 billion yen from 11 lenders.