Malaysian bankruptcies surge 14-fold

Malaysian bankruptcies surge 14-fold

KUALA LUMPUR (AFP): Malaysia's economic crisis prompted a 14- fold surge in bankruptcies to 6,578 in the first 11 months of 1997, up from 439 for the same period a year earlier, a report said yesterday.

Public trustee officer Idris Othman was quoted as saying that most cases occurred during August, October and November involving 708, 748 and 707 cases respectively.

The majority declared bankrupt were businessmen and those that stood as guarantor to individual and corporate loans, Idris told the Malay-language newspaper Berita Minggu.

"Other reasons included the share market speculation, failure to clear their credit card debts, gambling, natural disaster as well as failure to service their housing and car loans," he said.

Out of the 6,578 cases, some 2,828 people have been acquitted by the court, he added.

Those declared bankrupt are barred from involvement in any businesses, cannot be appointed a company director or travel overseas except with the court's permission.

They cannot own property and are required to declare their income and expenditure every half year.

Idris reminded businessmen to be careful in managing their finances and servicing their banks loans to avoid insolvency.

A total of 537 companies have been declared insolvent during the recessionary period in 1988 and another 622 the following year, he said, adding that 61,511 bankruptcies have been recorded since 1948.