News for Credit Professionals       NACM-SE

Commercial Bankruptcy Filings Stay Low in May

Year-over-year commercial bankruptcy filings continued to plummet in May 2012. While total bankruptcy filings for last month decreased by 11% compared to the previous year, commercial filings for May 2012 were 5,259, representing a 21% decrease from the 6,631 filings during the same period in 2011.

The 104,133 total noncommercial filings for May also fell, representing a 10% drop from the May 2011 noncommercial filing total of 116,205. "Households have reduced their spending and businesses are benefiting from sustained low interest rates," said Samuel Gerdano, executive director of the American Bankruptcy Institute (ABI), which, along with Epiq Systems, Inc., keeps track of nationwide bankruptcy numbers. "Expect a continued drop in bankruptcy filing rates as families and business reinforce their balance sheets and cut costs."

Total commercial Chapter 11 filings also decreased in May, with the filing total of 682 representing a smaller, but still notable 6% decrease from May's 2011 total.

Despite the fact that commercial filing figures for 2012 have continued to throw last year's readings into sharp relief, on a month-to-month basis the results have been less encouraging. May's total commercial Chapter 11 filing represented a 3% increase over April 2012, and total commercial filings increased by 2% in May from the April total of 5,170.

The average nationwide per capita bankruptcy filing rate for the first five calendar months of 2012 increased to 4.13 per 1,000 residents, up from 4.10 for the first four months. States with the highest per capital filing rate were Nevada (7.17), Tennessee (7.01) and Georgia (6.45).

- Jacob Barron, CICP, NACM staff writer