There were 362 commercial Chapter 11 filings registered in July 2023, an increase of 71% from the 212 filings registered in July 2022, according to data provided by Epiq Bankruptcy.
Overall commercial filings increased 21% to 1,961 in July, up from the 1,621 commercial filings registered in July 2022. Small business filings, captured as Subchapter V elections within Chapter 11, increased 61% to 153 in July, up from 95 in July 2022.
There were 35,716 total bankruptcy filings in July, a 15% increase from the July 2022 total of 30,862. Individual bankruptcy filings totaled 33,755 in July, registering a 16% increase from the July 2022 filing total of 29,241. There were 19,476 Individual Chapter 7 filings in July, a 17% increase vs. 16,645 in July 2022 and there were 14,229 individual Chapter 13 filings in July, a 13% increase over the 12,547 filings in July 2022.
“The increase in commercial Chapter 11 filings in July is an indication of the challenges businesses continue to face in these dynamic times; however, the data also suggests the economic recovery remains uneven and uncertain,” Gregg Morin, vice president of business development and revenue at Epiq Bankruptcy, said. “We remain committed to sharing the evolving financial landscape’s impact on new bankruptcy filings and supporting the market with bankruptcy data metrics.”
The July filing totals registered a decrease when compared to June. Commercial Chapter 11 filings registered the largest drop from June, as the July total decreased 38% from the June Chapter 11 filing total of 582. The July commercial filing total represented a 9% decrease from the June commercial filing total of 2,146. Subchapter V elections within Chapter 11 decreased 22% from the 196 filed in June. July’s total bankruptcy filings represented a 6% decrease when compared to the 37,782 total filings recorded in June. Total individual filings for July represented a 5% decrease from the June filing total of 35,636. Both individual Chapter 7 and Chapter 13 decreased 5% from June in July.
“More distressed consumers and businesses are turning to the financial lifeline of bankruptcy,” Amy Quackenboss, executive director of the American Bankruptcy Institute, said. “While filings are still below levels seen prior to the pandemic, rising interest rates, inflationary pricing and growing debt loads are contributing to an increase in households and businesses seeking a financial fresh start.”