Articles
02-10-05 Debt Forgiveness the Preferred Option for Japan’s Recovery
Lloyd, Benton & Taylor, LLC has always advocated this approach for its clients rather than the destructive process of signing away control of a business to the Bankruptcy Courts. Since the Japanese economy has been in recovery for a much longer period than that of the USA, Japan may be a very good model for us to follow. The following study was released today by Teikoku Databank:
THE ROLE OF DEBT FORGIVENESS IN JAPANA Study by Teikoku Databank America
153 Companies with Debt Forgiveness in 2004
Historically the Highest Number of Companies
with Debt Forgiveness by Banks
Introduction
Options for a recovery scheme by corporations have tremendously increased such as the issuance of shares against debts, division of company, and mergers of corporations. It is obvious that corporations in a slack or in excessive debt tend to choose "Recovery over Bankruptcy" to avoid legal reorganization. More attention is given to the importance of financial aid such as debt forgiveness, due to active re-constructions by the Industrial Revitalization Corporation and Resolution and Collection Corporation (RCC), in addition to the rise of the Corporation Reconstruction Fund. Although bad debt issues enter in its final phase, it is essential for a corporation's and an industry's recovery to have financial aid with an option of debt forgiveness.
Teikoku Databank conducted research on companies that made it through their debt forgiveness option, which include surviving companies and companies which had reorganized, dissolved, or merged after releasing liabilities between 1985 to Sept 30, 2004. All are principally counted at the time of reaching an agreement in debt forgiveness. This is our 11th research effort after the most recent one in May 2004.
<Research Results>
· There were 1,044 companies with agreements
in debt forgiveness, with a record-high of 251
in 2001. In 1994, self-reduction of excess debt
hit the limit, which created an upward increase
in the number of companies in debt forgiveness.
It is now 153 in 2004 (through Sept 30), and
increasing.
· By Pattern: The most common pattern
of debt forgiveness is "Parent Company (Non-Bank)
to Subsidiary" with 601 cases (57.6%), followed
by 165 (15.8%) in "Bank to General Company" and
109 (10.4%) in "Bank to Group Company".
In 2004 (through Sept 30), the number of debt
forgiveness by "Bank to General Company" is
at a record-high of 50 and continues to grow.
· By Sector: The "Manufacturing" sector with 171 companies (16.4%) exceeded "Non-Bank" with 149 (14.3%), followed by "Wholesale" with 117 (11.2%), "Service" with 111 (10.6%), "Construction" with 92 (8.8%), "Retail" with 86 (8.2%), "Real Estate/Housing" with 85 (8.1%) and "Third Sector" with 19 (1.8%). It has been dominated by the "Non-Bank" sector until 1996. After 1999, it spread to wider sectors including "Construction", "Retail", and "Real Estate/Housing" and a rapid increase is seen in the "Manufacturing" sector in 2004. “
Quick Information
90 Day Debt Restructuring. 100% Success Fees.
We are the only firm in the nation that offers a proven 90 day restructuring service on a 100% contingency fee basis.
Testimonials
Discover what people are saying about our services.
The Vision Made a Reality
Learn about the vision of President and Founder, Roderick Lloyd
Gold Medal Award
Mr. Roderick J. Lloyd has been chosen as a 2004 Ronald Reagan Republican Gold Medal Award winner.
Presidential Business Commission Nomination
NRCC announced today that Roderick Lloyd has been selected to represent the State of Florida on the new Presidential Business Commission.
News & Events
Discover what people are saying about our services.