Commercial Chapter 11 bankruptcy filings increased 72% to 6,569 in 2023 from the previous year’s total of 3,819, according to data provided by Epiq AACER, a provider of U.S. bankruptcy filing data.
Overall commercial bankruptcy filings increased 19% to 25,627 in 2023 from the 21,479 registered the previous year. Subchapter V elections within Chapter 11 also experienced a substantial increase in calendar year 2023, as the 1,939 filings represented a 45% increase from the 1,334 recorded in 2022.
There were 445,186 total bankruptcy filings in calendar year 2023, an 18% increase from the 378,390 registered during calendar year 2022. While representing a substantial year-over-year increase, total bankruptcy filings remain lower than the pre-pandemic total of 757,816 recorded in 2019.
“As anticipated, we saw new filings in 2023 increase momentum over 2022 with a significant number of commercial filers leading the expected increase and normalization back to pre-pandemic bankruptcy volumes,” Michael Hunter, vice president of Epiq AACER, said. “We expect the increase in number of consumer and commercial filers seeking bankruptcy protection to continue in 2024 given the runoff of pandemic stimulus, increased cost of funds, higher interest rates, rising delinquency rates and near historic levels of household debt.”
There were 419,559 overall consumer bankruptcy filing totals for calendar year 2023, representing an 18% increase from the 356,911 consumer filings the previous year. The 175,964 consumer Chapter 13 bankruptcy filings during calendar year 2023 also registered an 18% increase over 2022’s total of 149,069. Consumer Chapter 7 bankruptcy filings increased 17% in 2023 to 242,936 from 207,188 filings the previous year.
There were 34,447 total bankruptcy filings in December 2023, a 16% increase from the December 2022 total of 29,654. The consumer bankruptcy filing total of 32,390 also represented a 16% increase from the 27,917 consumer filings in December 2022. Overall commercial filings increased 18% in December 2023, as the 2,057 filings were up from the 1,737 commercial filings registered in December 2022. The 503 commercial Chapter 11 filings in December represented a 54% increase from the 326 filings in December 2022. Subchapter V elections within Chapter 11 experienced a 77% increase, from 114 in December 2022 to 202 in December 2023.
“Though still below pre-pandemic figures, bankruptcies in all filing categories climbed last year amid the evaporation of pandemic emergency responses, increased interest rates and tougher lending standards,” Amy Quackenboss, executive director of the American Bankruptcy Institute, said. “As interest rates remain elevated, increasing geopolitical tensions weigh on global supply chains and debt loads continue to grow, struggling businesses and families can turn to the proven process of bankruptcy for a financial fresh start.”
In partnership with Epiq, an abiLIVE webinar at 2:30 p.m. ET on Jan. 9 will feature experts looking at 2023 filing trends and providing their thoughts on what could happen with bankruptcies in the year ahead. Speakers on the program will include:
- Michael Hunter of Epiq AACER (Jacksonville, FL)
- Lindsay Zahradka Milne of Bernstein, Shur, Sawyer & Nelson, (Portland, ME)
- Ed Flynn of the ABI (Alexandria, Va.)
Deirdre O’Connor of Epiq (New York) will serve as moderator for the program. Click here for a complimentary registration.
