OKLAHOMA CITY – There were 634 commercial Chapter 11 filings registered across the nation in August 2023, an increase of 54% from filings registered in August 2022, according to data provided by Epiq Bankruptcy, the provider of U.S. bankruptcy filing data.
Overall commercial filings increased 14% to 2,328 in August 2023 compared to commercial filings recorded in August 2022. Small business filings, captured as Subchapter V elections within Chapter 11, increased 43% year-over-year to 194 in August 2023.
Total bankruptcy filings across the nation in August 2023 were 41,614, an 18% increase from August 2022.
Bankruptcy filings in August in Oklahoma’s three federal district courts totaled 570, a 17.5% increase from the 485 cases filed in August 2022.
Individual bankruptcy filings in the U.S. totaled 39,286 in August 2023, an 18% increase from the August 2022 filing total.
There were 22,887 individual Chapter 7 filings in August, a 21% increase from filings in August 2022, and there were 16,341 individual chapter 13 filings in August, a 13% increase from the previous year.
August marks 13 consecutive months that total, individual and commercial bankruptcy filings registered monthly year-over-year increases.
“The continued Y-O-Y increases indicate the anticipated growth of bankruptcy filings is becoming a reality,” said Gregg Morin, vice president of business development and revenue at Epiq Bankruptcy.
“Elevated interest rates, rising prices due to inflation, and resumption of student loan payments are just a few examples of the economic headwinds facing businesses and individuals,” said Amy Quackenboss, executive director of the American Bankruptcy Institute. “Struggling families and companies looking to find their financial footing are increasingly turning to the established path of bankruptcy.”
Bankruptcy filings rose in Oklahoma
A little over 4,000 bankruptcy filings were logged in Oklahoma’s three federal district courts during the first eight months of this year. They included 2,362 cases in Oklahoma City’s Western District Bankruptcy Court, 994 in Tulsa’s Northern District Bankruptcy Court, and 649 in Muskogee’s Eastern District Bankruptcy Court.
Those filings constituted an increase of almost 21% over bankruptcy filings in Oklahoma during the first eight months of last year. The majority of the cases filed this year sought liquidation under Chapter 7 bankruptcy.
The 2,973 total commercial Chapter 11 reorganization bankruptcies filed nationwide during the first six months of 2023 represented a 68% increase over cases filed during the same period in 2022, according to data provided by Epiq Bankruptcy.
Individual Chapter 13 filings increased by 23% during the same period. In Chapter 13 cases, debtors propose a repayment plan to make installments to their creditors over three to five years.
Overall commercial filings registered 12,107 for the first half of 2023, representing an 18% increase from the commercial filing total for the first half of 2022. Small business filings, captured as Subchapter V elections within Chapter 11, totaled 814 in the first six months of 2023, a 55% increase from the 525 elections during the same period in 2022.
“The increase in commercial and individual bankruptcy filings during the first half of 2023 underscores the economic challenges faced by businesses and individuals,” Morin said.
Total bankruptcy filings nationwide were 217,420 during the first six months of 2023, a 17% increase from total filings during the same period a year ago.
Total individual filings also registered a 17% increase over filings during the first six months of 2022. The 85,390 individual Chapter 13 filings in the first half of 2023 represent a 23% increase over filings during the same period in 2022.
“The growth in filings is reflective of more families and businesses facing surging debt loads due to rising interest rates, inflation, and increased borrowing costs,” said Quackenboss. “Bankruptcy provides a shield to the economic challenges being experienced by financially struggling individuals and companies.”
The substantial year-over-year increase in Subchapter V elections reflects statutory developments that took place last year. The Bankruptcy Threshold Adjustment and Technical Corrections Act was enacted in June 2022 to restore the debt eligibility limit for small businesses back to $7.5 million while also increasing the debt limit for individual Chapter 13 filings to $2.75 million and removing the distinction between secured and unsecured debt for that calculation. The increased eligibility limits for both Subchapter V and Chapter 13 were due to sunset in 2024.
About ABI, Epiq
ABI has partnered with Epiq Bankruptcy to provide the most current bankruptcy filing data for analysts, researchers, and members of the news media.
Epiq, a global technology-enabled services leader to the legal industry and corporations, streamlines administration of business operations, class action and mass tort, court reporting, eDiscovery, regulatory, compliance, restructuring, and bankruptcy matters.
ABI, based in Alexandria, Virginia, was founded in 1982 and is the largest multidisciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency.