Toshiba's shares dropped even lower as it looks to creditor banks for support

 
Courtney Goldsmith
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Toshiba's chief executive Satoshi Tsunakawa has faced criticism from shareholders (Source: Getty)

Toshiba's woes continued today as reports said it will ask for more financial assistance to cover losses, sending shares down more than nine per cent.

The Japanese conglomerate is meeting creditor banks, including Sumitomo Mitsui Trust and Mizuho and is expected to ask them not to call in their loans and accept shares in other businesses as collateral. The company made the same request last month, but failed to gain creditors' support.

The collateral might also include shares in its memory chip business, which it is splitting off and selling to help cover losses from its US nuclear unit Westinghouse, which filed for bankruptcy protection last month.

The drop in its stock made Toshiba the worst performer on Japan's benchmark Nikkei225 index.

Shares tumbled more than five per cent yesterday after reports said the company would miss a third deadline to report financial results. Toshiba is set to announce its quarterly earnings for October to December on 11 April, but its auditor, PwC, has questions about financial results for the business year through March 2016.

There is speculation the group could be demoted to a lower-tier share market or get delisted if its shares continue to fall.

Read more: Toshiba called a "laughing stock" as shareholders approve chip unit split

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