Acom Co. and Promise Co., Japan’s two biggest consumer lenders, posted losses last year as overcharged-interest repayments rose and it set aside additional funds to cover bad-loans related to Japan’s record earthquake.
Acom’s loss for the year ended March 31 was a greater-than-forecast 202.6 billion yen ($2.48 billion), compared with a 7.2 billion yen loss a year earlier, it said in a preliminary earnings statement to the Tokyo Stock Exchange today. Promise, partly owned by Sumitomo Mitsui Financial Group Inc., swung to a 96 billion yen loss from a 14.6 billion yen profit, it said.
The magnitude-9 quake and ensuing tsunami that devastated parts of northern Japan on March 11 forced Acom to set aside 10.1 billion yen for bad loans. The Mitsubishi UFJ Financial Group Inc. affiliate on Nov. 9 had forecast an annual loss of 50.9 billion yen.
The disaster sent Japan’s factory output down by 15.3 percent in March from a month earlier, the biggest drop since data began in 1953, and household spending dropped 8.5 percent from a year earlier. The number of dead and missing totaled 25,920 as of 10 a.m. local time today, according to the country’s National Police Agency.
Japan’s consumer lenders are also coping with a four-year crackdown on coercive lending that has resulted in customer claims and lawsuits seeking repayment of overcharged interest. Promise said today it booked provisions of 238 billion yen to cover overpaid-interest repayments, as the September bankruptcy of rival Takefuji Corp. spurred claims from borrowers.
Kyoto-based Aiful Corp., the nation’s third-biggest consumer lender, said in a preliminary earnings statement its net loss for the year narrowed to 32 billion yen from a loss of 295.1 billion yen a year earlier. The company booked a loss of 10 billion yen including 6.5 billion yen in bad-loan provisions related to the earthquake.