Decline in Business Bankruptcies in 2011 Creates Uncertainty for 2012
by Joel R. Glucksman on May 10, 2012
Business bankruptcy filings fell in 2011 from the year before, but industry professionals say filing trends for 2012 remain uncertain.
The decline in filings is likely the result of more businesses utilizing out-of-court restructurings facilitated by high-yield debt financing, according to the National Law Journal. The number of business bankruptcy filings fell from 56,282 in 2010 to 47,806 in 2011. Overall filings also fell, the first time there has been a drop since 2007. Industry professionals say bankruptcy filings may have dropped in 2011 as a result of creditors wanting to give more businesses time to correct their situations before filing for protection under bankruptcy law. However, the trend may not continue as evidenced by 2012 filings increasing at a faster rate.
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