Commercial bankruptcy filings in US increase 61% in first 9 mnths of 2023
Commercial bankruptcies in the United States increased 61% in the first nine months of 2023, compared to the same period in 2022, according to data from Epiq Bankruptcy. This increase was driven by a 41% rise in small business bankruptcies.
Overall bankruptcy filings also increased 17% year-to-date, to 332,138. Individual filings increased at the same rate, to 313,458.
The increase in bankruptcy filings is attributed to a number of factors, including rising interest rates, inflation, and increased borrowing costs. These factors are making it more difficult for businesses and individuals to manage their debt.
“While still below pre-pandemic levels, the numbers of filings demonstrate the difficult challenges and growing debt loads that financially distressed families and businesses are facing in this current economic environment,” said ABI Executive Director Amy Quackenboss.
Despite the increase in bankruptcy filings, Quackenboss noted that there is an established lifeline through bankruptcy to help steady individuals and businesses amid rising interest rates, inflation, and increased borrowing costs.
September Bankruptcy Filings
In September 2023, overall commercial bankruptcy filings increased 16% to 2,342 from 2,022. Commercial chapter 11 filings increased 29% to 573 from 455. Total subchapter V elections within chapter 11 increased 25% to 171 from 137 in September 2022.
All chapters increased in September 2023 compared to September 2022, with the 37,327 total bankruptcy filings representing an increase of 12% from the 33,210 filed in September 2022. Total individual filings were up 13%, to 35,138 from 31,188. The 19,793 individual chapter 7 filings in September 2023 increased 14% over the 17,320 filings in September 2022. Individual chapter 13 filings were up 11% in September 2023 to 15,285 from 13,819 the previous year.
Conclusion
The increase in bankruptcy filings in the first nine months of 2023 is a sign of the economic challenges that businesses and individuals are facing. However, it is important to note that bankruptcy is an established lifeline that can help people and businesses get back on their feet.
