Japan: Insiders foretell Yamato Life's bankruptcy on 2-Channel

The effects of the American subprime loan crisis have arrived in Japan and the first company fall victim to the outfall is Yamato Life Insurance Company (大和生命保険会社). The Japanese midsize insurer filed for bankruptcy on the 10th of October and applied to the Tokyo District Court for bankruptcy protection under the Corporate Rehabilitation Law.

The causes are said to be related to the risky business model adopted by president Nakazono, in charge since March 2008, as 42.2% of the company's assets seem to have come from real estate investment trusts, foreign stocks and collateralized debt obligations. In addition, as of the end of September, Yamato Life's net loss was about 11.5 million yen, and the solvency margin ratio only 26.9%.

While much has been speculated about relations between the insurer's bankruptcy and the world financial crisis and its causes, in the last week many blogs have reported on a different angle to the story, reacting to a thread that appeared few months ago on 2channel (2チャンネル), the most popular message board in Japan.

The anonymous announcement says:

小さな悪魔の会社、大和生命 に注意!Ⅱ
1 もし2008/05/06(火) 20:57:04

Watch out for Yamato Life, the little company of the devil!
I don't think the company will last until this thread reaches 1000 [entries],
but I'd like to share information with all of you between now and then!
Let's all of us, those who are active [commenters] as well as the old boys, all try to keep [this thread] going!!

As prophesized in this entry dated the 6th of May, the total number of entries reached just around 250 when Yamato Life's bankruptcy was publicly announced by the company's president. It is very interesting to browse the whole thread and to see how people, mainly employees of the company, have continued to update news about the last months of life of their company from back in May to October, denouncing from the inside the dangers of the company's bad administration and writing about its financial troubles.

The thread continues:

7 もしもの為の名無しさん2008/05/08(木) 20:58:09

Did they just sell all their real estate like crazy to bring [the company] into the black?

9 もしもの為の名無しさん2008/05/08(木) 22:16:36

I guess they don't have any more real estate left

17 もしもの為の名無しさん2008/05/09(金) 23:28:25

[The company] is really in trouble.
The system is also out-of-date, but the biggest problem is that the thinking of the management is obsolete.

Many comments mentioned the suspiciously large number of employees, managers included, who quit their jobs at Yamato Life in the last months.

43 もしもの為の名無しさん2008/05/20(火) 06:42:20

Mm the closing audit…
How many executives will quit this year?

45 もしもの為の名無しさん2008/05/21(水) 07:24:22

How many people will resign at the end of this year?

46 もしもの為の名無しさん2008/05/21(水) 21:30:38

The fact that so many of them are core people, and that all of them are going to work at other companies of the same industry, is clearly due to mismanagement, it's a man-made disaster.
The executives of personnel affairs will obviously be replaced, and maybe the people who should be ashamed about this will take responsibility for it…
What a reckless bunch of people! They act as if they didn't know.

As the company had planned to go public in November, in the last months it was acting under due diligence, but from the posts on 2-Channel it seems that there was not enough transparency on the matter.

59 もしもの為の名無しさん2008/05/31(土) 08:41:24

From the budget for the 2007 [fiscal year], it seems they are selling their properties. Having failed with operations, the executive in charge passed on the responsibility [for what happened], and resigned.
I'm eager to see the head of the department demoted, and hear how the board, and the president for starters, will take responsibility for shareholders. I'm looking forward to the general assembly of shareholders in June!
But in any case, I think the millions of yen in losses caused by investments and subprime money will come as a big shock for Yamato Life.

65 もしもの為の名無しさん2008/06/03(火) 00:20:50

It serves them right. Because they chose as directors people who act with incompetence time and time again.
Everybody inside the company knew it, but they were still cheated because they were not connected to other people.

77 もしもの為の名無しさん2008/06/05(木) 22:44:34

I'd like to ask to the external auditor two things:
1. Concerning the fulfillment of duties by the director, has it been recognized that he carried out illegal acts, and has the minor fact that he violated laws or company statutes been recognized?
2. With the distribution of dividends to policyholders, where net assets have dropped from 26.5 billion yen to 4 billion yen, shedding light on the company's situation — isn't there some kind of problem here?

78 もしもの為の名無しさん2008/06/06(金) 00:45:32

And despite this they go will public in November.

84 もしもの為の名無しさん2008/06/08(日) 23:07:56

To comment 78:
The listing has been postponed for an indefinite time.
Apparently if you have some shares the stock owners will buy them for double.
although they are already full until next year.

108 もしもの為の名無しさん2008/06/18(水) 22:50:57

This is perfect timing for the resignation announcement by the auditor.

114 もしもの為の名無しさん2008/06/21(土) 00:00:02

Can employees buy shares?

115 もしもの為の名無しさん2008/06/22(日) 13:57:01

They are forced to buy them even if they don't want to.
Although they are not even sure if they will get their retirement allowance, how horrible!

Finally, in September, in the last days before the announcement of bankruptcy:

207 もしもの為の名無しさん2008/09/06(土) 01:11:23

I really want the Financial Services Agency to state their view about the loss in assets due to lack of policy among management ranks, and in particular due to their assurances of basic profits.
They can't go selling off assets every year.

228 もしもの為の名無しさん2008/10/01(水) 00:03:43

The asset management problem is really serious
The inspection period has been extended a great deal
The President is still hiding in the hospital
Did the criminal from Akita succeed in covering things up?

245 もしもの為の名無しさん2008/10/10(金) 09:15:04
アボーン 大和生命、更生特例法の適用申請

Dadaaan! Yamato Life applies for special exemption under the Corporate Rehabilitation Law

248 もしもの為の名無しさん2008/10/10(金) 09:21:16

And the bankruptcy has cooooome!!!

260 もしもの為の名無しさん2008/10/10(金) 09:23:27


But I was just recruited…

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