Total Bankruptcy Filings Up 24 Percent
NEW YORK and ALEXANDRIA, Va., Aug. 05, 2024 (GLOBE NEWSWIRE) — Commercial chapter 11 filings increased 40 percent in July 2024 to 510 from the 364 filings in July 2023, according to data provided by Epiq AACER, the leading provider of U.S. bankruptcy filing data. Overall commercial filings also increased 17 percent in July 2024 to 2,335 from 2,004 in July 2023.
The 44,427 total U.S. bankruptcy filings in July 2024 increased 24 percent from the July 2023 total of 35,727. Individual bankruptcy filings registered a 25 percent increase, to 42,092 in July 2024 from the July 2023 individual total of 33,723. The number of consumers filing for chapter 7 increased 32 percent to 25,720 in July 2024 from the 19,463 who filed for chapter 7 last July, while chapter 13 filings increased 15 percent to 16,307 in July 2024 from the 14,211 chapter 13 filings in July 2023.
“We continue to see a strong and steady rise in bankruptcy filings across the board, reflecting ongoing financial pressures faced by both businesses and individuals,” said Michael Hunter, vice president of Epiq AACER. “Based on current trends and economic indicators, I expect bankruptcy filing volumes to continue this steady increase throughout the remainder of 2024 and into 2025.”
Small business filings, captured as subchapter V elections within chapter 11, were 171 in July 2024, registering a 45 percent drop from June’s record total of 308. The filing decrease followed a statutory sunset that was unable to be extended by Congress before June 21. The enhanced subchapter V debt limit established in March 2020 dropped from $7,500,000 to $3,024,725, and the chapter 13 threshold of $2,750,000 for both secured and unsecured debt reverted back to a two-part test limiting eligibility to a maximum of $465,275 for unsecured debt and $1,395,875 for secured debt.
“The reversion of the debt limit narrowed the path for distressed small businesses looking to access the cheaper and more efficient process of subchapter V to restructure their debts,” said ABI Executive Director Amy Quackenboss. “ABI is ready to work with members of Congress to provide them with the data necessary to answer questions they might have regarding the benefits that the higher subchapter V debt limit offers to many struggling small businesses in their efforts to restructure, so that more employees can keep their jobs and investors are afforded a better chance to recover their investments.”
ABI’s Subchapter V Task Force on April 19 released its Final Report and recommendations to Congress, and its findings support maintaining the eligibility limit of $7.5 million in aggregate noncontingent, liquidated debt for small businesses looking to reorganize under subchapter V. Additionally, ABI is creating a portal for subchapter V practitioners and experts to provide their testimony on their experiences regarding how the increased debt limit assisted small business restructurings. The portal will be launched soon at https://subvtaskforce.abi.org/.
July’s total bankruptcy filings represented a 10 percent increase from June’s total of 40,276. Total individual filings for July represented a 12 percent increase from the June 2024 individual filing total of 37,518. Conversely, the commercial filing total represented a 15 percent decrease from the June 2024 commercial filing total of 2,758, and commercial chapter 11 filings decreased 48 percent from the 989 filings in June 2024, which saw two cases with a large number of related filings. Consumer chapter 7 filings increased 16 percent from the 22,190 chapter 7s filed in June 2024, while chapter 13 filings increased 7 percent over the 15,230 filings last month.
Epiq AACER is a division of Epiq and is the leading provider of data, technology, and services for companies operating in the business of bankruptcy. Its Bankruptcy Analytics subscription service provides on-demand access to the industry’s most dynamic bankruptcy data, updated daily. Learn more at https://bankruptcy.epiqglobal.com.
About Epiq
Epiq, a global technology-enabled services leader to the legal industry and corporations, takes on large-scale, increasingly complex tasks for corporate counsel, law firms, and business professionals with efficiency, clarity, and confidence. Clients rely on Epiq to streamline the administration of business operations, class action and mass tort, court reporting, eDiscovery, regulatory, compliance, restructuring, and bankruptcy matters. Epiq subject-matter experts and technologies create efficiency through expertise and deliver confidence to high-performing clients around the world. Learn more at https://www.epiqglobal.com.
About ABI
ABI is the largest multi-disciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency. ABI was founded in 1982 to provide Congress and the public with unbiased analysis of bankruptcy issues. The ABI membership includes nearly 10,000 attorneys, accountants, bankers, judges, professors, lenders, turnaround specialists and other bankruptcy professionals, providing a forum for the exchange of ideas and information. For additional information on ABI, visit www.abi.org. For additional conference information, visit http://www.abi.org/calendar-of-events.
Press Contacts
Carrie Trent
Epiq, Director of Communications
Carrie.Trent@epiqglobal.com
John Hartgen
ABI, Public Affairs Officer
jhartgen@abi.org
