ALEXANDRIA, Va. –
What Congressional lawmakers and the White House do in the coming days to enhance federal assistance to help consumers and businesses get through the coronavirus pandemic are likely to impact bankruptcy filings, according to the executive director of the American Bankruptcy Institute (ABI).
According to data provided by Epiq, ABI reported that bankruptcy filings declined in June as well as through the first half of the year. But ABI executive director Amy Quackenboss can see a scenario where the trends reverse.
“Businesses and consumers continue to navigate a challenging economic course as a result of the financial crisis due to the COVID-19 pandemic,” Quackenboss said in a news release. “As government lifelines to help stabilize the economy begin to expire, bankruptcy provides a shield for households and companies facing intensifying financial distress. We anticipate filings to begin increasing as a result.”
Epiq’s data showed total bankruptcy filings decreased to 298,080 during the first six months of 2020, representing a 23% decrease from the 388,594 total filings during the same period a year ago.
Officials indicated total consumer filings registered a 24% decrease as the 280,649 filings during the first half of 2020 declined from the 368,953 filings during the first six months of last year.
ABI went on to note that the 17,431 total commercial filings for the first half of 2020 represented an 11% drop from the commercial filing total of 19,641 for the first half of 2019.
Looking just at June, officials found that total bankruptcy filings dropped 31% to 42,416 from the 61,102 total filings in June of last year.
Noncommercial bankruptcies for June decreased 32% to 39,719 from the 58,005 filings last June.
On the business front, ABI recapped that total commercial Chapter 11 bankruptcies for June were 609, representing a 44% increase from the 424 commercial Chapter 11 filings in June of last year.
According to Epiq’s data, there were a number of notable Chapter 11 cases filed in June, including two more Catholic Dioceses, numerous large energy-related cases including Chesapeake Energy, and a number of well-known national companies such as 24 Hour Fitness, General Nutrition, Libbey Glass and Chuck E. Cheese.
Officials added more than one-half of the Chapter 11 cases filed during the month were actually associated cases filed by the subsidiaries of a larger financial group.
ABI pointed out that total commercial bankruptcies slipped to 2,697 filings in June, a 13% decrease from the 3,097 registered during June of last year.
Also of note, officials determined the average nationwide per capita bankruptcy filing rate for the first six calendar months of 2020 decreased slightly to 1.92 (total filings per 1,000 per population) from 1.98 for the first five months. The average total filings per day in June were 1,928, a 37% decrease from the 3,055 total daily filings in June of last year.
States with the highest per capita filing rate (total filings per 1,000 population) through the first six months of 2020 included:
1. Alabama (4.46)
2. Delaware (3.89)
3. Tennessee (3.88)
4. Mississippi (3.49)
5. Georgia (3.25)
ABI has partnered with Epiq, a leading provider of managed technology for the global legal profession, in order to provide the most current bankruptcy filing data for analysts, researchers and members of the news media.