According to data provided by Epiq Bankruptcy, new bankruptcy filings in March 2023 registered year-over-year increases across all U.S. major filing categories for the third month in a row.
A total of 42,368 new bankruptcies were filed in March, up 17% from the 36,068 filings registered in March 2022 and marking the highest number of monthly filings since the 40,931 bankruptcies recorded in April 2021.
Year-over-year commercial filings were up 24% to 2,305 compared to 1,854 in March 2022. Commercial Chapter 11 filings (including Subchapter V) increased 79% to 548 versus the 306 filings registered in March 2022. Of the total commercial Chapter 11 filings, the 140 Subchapter V filings in March represented a 12% increase from the 125 filings in March 2022.
Total individual filings increased 17% to 40,063 versus 34,214 in March 2022. Year-over-year individual Chapter 7 filings increased 13% to 24,467 versus 21,594, and individual Chapter 13 filings were up 24% to 15,537 versus 12,532 in March of 2022.
“While total filings are up for the third month in a row and exceeded the 40,000 level for the first time in two years, the jump also reflects the historical trend of March consistently being the highest month for filings every year,” Gregg Morin, vice president of business development and revenue for Epiq Bankruptcy, said.
For Q1/23, the 105,433 total bankruptcy filings represented an 18% increase from the 89,289 total filings during the same period last year. Consumer filings also increased 18%, to 99,700 filings in Q1/23 from the 84,481 consumer filings during the same period in 2022.
Total overall commercial bankruptcies increased 19% in Q1/23, as the 5,733 filings surpassed the 4,808 commercial filings during Q1/22. Total commercial Chapter 11 filings registered a 77% increase to 1,301 during Q1/23 from the 735 total commercial Chapter 11 filings during the same period in 2022. Subchapter V elections for small businesses increased, as the 371 filings in Q1/23 were up 33% from the 280 filed during Q1/22. Individual Chapter 7 filings during Q1/23 were 57,172, a 12% increase over the 51,083 individual Chapter 7 filings during the same period of 2022. Individual Chapter 13 filings during Q1/23 were 42,364, a 28% increase over the 33,189 individual Chapter 13 filings in the same period of 2022.
Comparing month-over-month data, the 42,368 total filings in March were 33% higher than the 31,898 filings recorded in February. Total commercial filings increased 35% to 2,305 from the 1,710 filings the month prior. Total commercial Chapter 11 filings (including Subchapter V) increased 46% to 548 from the 375 filed in February. Of the total commercial Chapter 11 filings, Subchapter V filings increased 18% to 140 in March, up from 119 in February.
Total month-over-month individual filings increased 33% to 40,063 from 30,188. Individual Chapter 7 filings increased 44% to 24,467 from 16,988 in February, while individual Chapter 13 filings increased 18% to 15,537 from the 13,148 filed in February.
“The increase in bankruptcy filings in the first quarter of the year demonstrates the growing debt burdens of both consumers and businesses,” Amy Quackenboss, executive director of the American Bankruptcy Institute, said. “As inflationary prices have increased in tandem with the cost of borrowing, struggling companies and households have access to a financial reprieve through the bankruptcy process.”