Commercial Chapter 11s Jump 48% in May Y/Y
Total commercial Chapter 11 filings in May increased 48 percent from the previous year, according to data provided by Epiq Systems, Inc. Commercial Chapter 11 filings totaled 722 in May 2020, elevated from the May 2019 total of 487, the American Bankruptcy Institute reported. Conversely, total commercial filings decreased 28 percent in May, as the 2,578 filings were down from the 3,558 commercial filings registered in May 2019.
The 39,969 total bankruptcy filings in May were down 42 percent from the 68,860 total filings in May 2019. Total consumer filings decreased 43 percent in May, as the 37,391 filings fell from the 65,302 consumer filings registered in May 2019.
“Companies that tried to shore up their balance sheets at the beginning of the year represent the initial wave of Chapter 11s due to the economic crisis brought about by the COVID-19 pandemic,” said ABI Executive Director Amy Quackenboss. “The CARES Act and other swift government measures have been successful in keeping consumers afloat during the crisis. As this relief runs its course, however, mounting financial challenges may result in more households and companies seeking the shelter of bankruptcy.”
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ABL Advisors Published June 4, 2020.