According to AIS proprietary data, May 2020 witnessed a decrease of 41.94% in the total bankruptcy filings when compared to that of the same month last year.

In May 2019, the number of bankruptcy filings totaled to 68, 829, whereas, May 2020 accounted for just 39,961 filings (Figure 1). However, an increase of nearly 41% was also recorded in commercial chapter 11 filings, which raised from 535 filings in May 2019 to 757 in May 2020 (Figure 3).

Figure 1

As per month-over-month comparison, there was a nearly 4% increase; the number of filings in May 2020 reached 39,961 from 38,439 (Figures 1 and 2). Moreover, the total commercial chapter 11 bankruptcies also increased by 27%. Commercial chapter 11 bankruptcies totaled 592 in April 2020 whereas they increased to 757 in May 2020 (Figure 3).

Figure 2

Figure 3

The highest percentage of bankruptcies for May 2020 came from the South (East) (26%) followed by North Central (East) (20%), South (West) (13%), Pacific (14%), Northeast (12 %), Mountain (8%)  and North Central (West)(7%) regions of the country (Figure 4).

Figure 4 Bankruptcy Filings in May 2020 by region

This is the third consecutive month of declining bankruptcy volumes, when compared to the same time period in 2019. The dip in bankruptcy filings during the second quarter is attributed to the COVID-19 shelter in place initiatives throughout the United States. As these precautions are gradually lifted a backlog of bankruptcies are expected to follow.

The AIS Insight Report is a proprietary report created by AIS using data derived sole from information obtained by the Federal Bankruptcy Court System and the latest in bankruptcy analytical tools.

To download the full May Insight Report, click here.