Why do fewer cases still pose high risk to investors?

Because a small number of large failures can dominate total liabilities. Even as counts fall, a single big default can hit banks, suppliers, and bondholders hard. Limiting single-name exposure and monitoring governance signals helps reduce this concentration risk.

What are practical early-warning signs to watch?

Look for tax arrears, social insurance delinquencies, delayed vendor payments, audit opinion changes, executive resignations, and covenant waivers. Track legal notices and investigations. Combine these with payment behavior and inventory checks to flag counterparty stress before defaults emerge.

How should lenders adjust credit terms in 2025?

Shorten loan tenors for opaque borrowers, require stronger collateral, and increase pricing for weak controls. Add covenants tied to auditor timelines and regulatory filings. Review exposure maps quarterly to avoid clusters around the same large customer or supplier.

Which compliance themes declined but still matter?

Business law violations and misuse of funds reportedly fell by over 30% in 2025, yet large-amount cases stood out. These issues still signal weak governance. Investors should review licensing status, cash application, and related-party transactions to gauge integrity risk.

Law and Government

Japan Compliance Bankruptcies -29% in 2025; Big Cases Loom — February 13

ByHuzaifa Zahoor February 13, 2026

Japan compliance bankruptcies dropped to 278 cases in 2025, down 28.9% year over year, according to the latest TDB compliance report. The decline hides a key risk: large failures accounted for a heavy share of total liabilities, signaling persistent exposure for banks and investors. We break down what Japan compliance bankruptcies mean for credit risk monitoring, why concentration in big cases matters, and the practical steps to strengthen counterparty checks in Japan’s market today.