Total commercial Chapter 11 filings during the first six months of the year increased 26% to 3,604 from the 2,855 total filings during the same period in 2019, according to data provided by Epiq. Total bankruptcy filings also decreased to 298,080 during the first six months of 2020, a 23% decrease from the 388,594 total commercial filings during the same period a year ago.
Total consumer filings registered a 24% decrease, as the 280,649 filings during the first half of 2020 were down from the 368,953 filings during the first six months of 2019. 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.
“Businesses and consumers continue to navigate a challenging economic course as a result of the financial crisis due to the COVID-19 pandemic,” Amy Quackenboss, executive director of the American Bankruptcy Institute, said. “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.”
Total commercial Chapter 11 bankruptcies for the month of June 2020 were 609, representing a 44% increase from the 424 commercial Chapter 11 filings in June 2019. During June there were a number of notable Chapter 11 cases filed, 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. More than half of the Chapter 11 cases filed during the month were actually associated cases filed by the subsidiaries of a larger financial group.
Total commercial bankruptcies slipped to 2,697 filings in June 2020, a 13% decrease from the 3,097 registered in June 2019. Total bankruptcy filings in June 2020 fell 31% to 42,416 from the 61,102 total filings in June 2019. Noncommercial bankruptcies for June 2020 decreased 32%, to 39,719 from the 58,005 filings in June 2019.
The ABI’s COVID-19 Resources website is continually updated 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, weekly filing statistics, recommended member analysis, industry sector news and charts. Also, the ABI’s SBRA Resources webpage is routinely updated with information, statistics, analysis and events related to the Small Business Reorganization Act that went into effect this year to make bankruptcy more accessible, efficient and cheaper for struggling small businesses.