(Corrects last paragraph to ... "$5.6 billion" ... from ... "5.6 billion yen")
* Industry hit by costs to reimburse overcharged interest
* Takefuji seen vulnerable due to lack of big bank backing
* It had $5.2 bln in liabilities as of end June-Tokyo Shoko
* Takefuji official says checking on media reports (Recasts, adds analyst comment, share prices)
TOKYO, Sept 27 (Reuters) - Struggling Japanese consumer lender Takefuji Corp is preparing to file for bankruptcy, media said, hit by stricter lending rules and court orders to repay interest on loans deemed illegally high.
Although Takefuji has been seen as more vulnerable because it does not have the backing of a big bank like its rivals, shares of other consumer lenders dived amid concerns they would be inundated by more reimbursement claims for overcharged interest.
Takefuji, which once ranked as Japan's biggest consumer finance lender, had 433.6 billion yen ($5.2 billion) in liabilities as of the end of June, research firm Tokyo Shoko Research said.
The Nikkei business daily said that Takefuji was in the final stage of preparations to file for bankruptcy. The Jiji and Kyodo news agencies also said it was likely to file for bankruptcy.
An official in Takefuji's finance division said the company was checking on the media reports and declined to comment further.
A Japanese court in 2006 ruled that Japan's consumer finance companies had charged lenders too much interest and ordered them to give back billions of dollars to borrowers.
Tighter lending rules have also added to their woes and in June, a new set of regulations cemented the interest rate ceiling at 20 percent, down from 29.2 percent, and limited the amount an individual can borrow.
Among rivals, Aiful tumbled 23 percent to 89 yen and Acom fell 11 percent to 1,329 yen. Promise Co slid 11 percent to 686 yen.
"There are concerns that reimbursement claims from customers, which means costs for consumer lenders, may increase and weigh on the whole industry, and such concerns are probably pushing down their shares today," said Koichi Niwa, senior analyst at Mizuho Securities.
The Tokyo Stock Exchange suspended trade in Takefuji shares.
The tough conditions have already claimed several victims. Credia became the first listed consumer finance firm to fold in 2007 while SFCG Co, a lender to small companies, failed in 2009 with more than $3 billion in debts.
Late last year, Aiful Corp staved off bankruptcy by convincing its creditors to defer about 280 billion yen in bank loan principal payments, using a debt rescheduling procedure called "alternative dispute resolution", or ADR.
Takefuji founder, Yasuo Takei, who died in 2006, ranked as Japan's second richest person in 2005 with a worth of $5.6 billion by Forbes. The U.S. magazine this year valued his widow at half that. (Reporting by Taiga Uranaka, Nathan Layne, Tim Kelly and Sachi Izumi; Editing by Edwina Gibbs)