Alexandria, Va.—Total commercial chapter 11 filings in May 2021 decreased 66 percent from the previous year, according to data provided by Epiq. Commercial chapter 11 filings totaled 246 in May 2021, down from the 725 commercial chapter 11 filings in May 2020. Total commercial filings decreased 31 percent in May 2021, as the 1,787 filings were down from the 2,599 total commercial filings registered in May 2020. The 34,760 total bankruptcy filings in May 2021 were down 13 percent from the 39,993 total filings in May 2020. Total consumer filings decreased 12 percent in May 2021, as the 32,973 filings fell from the 37,394 consumer filings registered in May 2020.
“Continued stabilization efforts by the federal government, forbearance by lenders and sustained low interest rates have helped keep many businesses and households afloat during the crisis,” said ABI Executive Director Amy Quackenboss. “As the pandemic relief runs its course, however, mounting financial challenges may result in more households and companies seeking the shelter of bankruptcy.”
A separate analysis on ABI’s SBRA Resources webpage showed that the 2,000th case was filed in May under the new subchapter V of chapter 11 of the Bankruptcy Code, established by the Small Business Reorganization Act of 2019 (SBRA). The SBRA went into effect on February 19, 2020, to provide Main Street business debtors with a more streamlined path for restructuring their debts. The CARES Act was subsequently enacted on March 27, 2020, which increased the eligibility limit for small businesses looking to file under the SBRA’s subchapter V from $2,725,625 of debt to $7,500,000. The threshold was originally scheduled to return to $2,725,625 after one year, but was extended to 2022 with the enactment of the COVID-19 Bankruptcy Relief Extension Act on March 27, 2021.
May’s commercial chapter 11 filings represented a 14 percent decrease from the 287 filings in April 2021. Total commercial filings were also down 14 percent from the April 2021 commercial filing total of 2,083. Total bankruptcy filings in May represented a 15 percent decrease from the 40,913 total filings recorded the previous month. Total noncommercial filings for May also represented a 15 percent decrease from the April 2021 noncommercial filing total of 38,830.
The average nationwide per capita bankruptcy filing rate in May was 1.41 (total filings per 1,000 per population), a slight decrease from the 1.43 filing rate during the first four months of the year. Average total filings per day in May 2021 were 1,738, a 13 percent decrease from the 2,000 total daily filings in May 2020. States with the highest per capita filing rates (total filings per 1,000 population) in May 2021 were:
1. Alabama (3.20)
2. Nevada (2.93)
3. Tennessee (2.55)
4. Delaware (2.40)
5. Indiana (2.29)
ABI has partnered with Epiq in order to provide the most current bankruptcy filing data for analysts, researchers and members of the news media. Epiq is a leading provider of managed technology for the global legal profession. To view the full monthly statistical tables provided by Epiq, be sure to visit ABI’s Newsroom.
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 11,000 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.
Epiq, a global technology-enabled services leader to the legal services 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.