Federal assistance possibly slows April bankruptcy filings
The newest information from the American Bankruptcy Institute (ABI) possibly shows the positive impact of federal intervention to support consumers and businesses during the coronavirus pandemic.
According to data provided by Epiq Systems and released on Tuesday, total U.S. bankruptcy filings in April decreased 46% from the previous year. ABI said bankruptcy filings totaled 38,428 in April, down from last April total of 71,303. The 36,150 consumer bankruptcy filings in April were down 47 percent from last April’s consumer total of 67,802.
Officials noted total commercial filings decreased 35% in April, as the 2,278 filings declined from the 3,501 commercial filings registered in April of last year. Conversely, ABI pointed out total commercial Chapter 11 filings jumped 26 percent to 560 in April from last April’s total of 444.
“The extraordinary measures taken by Congress and the administration to assist individuals and businesses weather the initial economic shock caused by the pandemic have likely staved off bankruptcy filings to date,” ABI executive director Amy Quackenboss said in a news release.
“As financial challenges continue to escalate amid this crisis, bankruptcy is sure to offer a financial safe harbor from the economic storm,” Quackenboss continued.
ABI recently launched its new COVID-19 resources website for bankruptcy professionals and the public to access essential information and analysis regarding the financial distress being inflicted by the COVID-19 pandemic. The site features exclusive ABI content on the crisis, recommended member analysis, industry sector news, charts and more.
Officials went on to mention April’s total bankruptcy filings represented a 39% decrease when compared to the 62,866 total filings recorded during the previous month.
ABI added total noncommercial filings for April also represented a 39% decline from the March noncommercial filing total of 59,684.
The latest data also showed the commercial filing total represented a 28% decrease from the March commercial filing total of 3,182. Commercial Chapter 11 filings increased 6% from the 530 filings in March.
Finally, officials said the average nationwide per capita bankruptcy filing rate in April was 2.09 (total filings per 1,000 per population), a decrease from the 2.29 filing rate during the first three months of the year. Average total filings per day in April came in at 3,239, a 3% decrease from the 3,323 total daily filings in April of last year.
States with the highest per capita filing rates (total filings per 1,000 population) in April included:
1. Alabama (5.02)
2. Tennessee (4.44)
3. Mississippi (3.99)
4. Georgia (3.78)
5. Delaware (3.52)
ABI has partnered with Epiq Systems, 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.