Olympus loans under scrutiny as lies catch up with firm

Troubled Japanese camera and medical equipment maker Olympus says it believes its lenders will support it, despite admitting it lied in its financial reports.

Last year the group's British Chief Executive revealed the firm had been covering up huge losses on complicated investments dating back nearly 20 years.

He was forced out but the company's reputation was battered, resulting in a share-price loss of nearly 80%

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Olympus has recovered in 2012 but the lies in its financial reporting mean it will be in breach of its loan covenants with lenders.

The Financial Times was reporting on Thursday the amount of loans which might be pulled could total $4.1bn.

Olympus officials are, however, saying they expect the lenders to continue offering "support".

Japanese business has been rocked by the scandal, which has thrown into doubt the competence of regulators in Tokyo and made foreign investors wonder openly whether investing in Japanese firms is worth the risk.

BS