- In May, 27 companies with at least $US50 million in liabilities filed for court protection from their creditors,Bloomberg reported Thursday.
- It’s the fastest pace of filings since May 2009, following the Great Recession, according to the report.
- In addition, as the coronavirus pandemic continues to slam the global economy, it’s likely more companies will seek court protection from creditors.
- Read more on Business Insider.
The number of companies filing for bankruptcy has surged to a clip not seen since May 2009, following the Great Recession,Bloomberg reported Thursday.
In May, 27 companies with at least $US50 million in liabilities filed for court protection from their creditors, according to the report. This group of companies, which includes a range from retailers J.Crew,JCPenney, and Pier 1 Imports to air carriers like Latam, represents the highest number of bankruptcy filings since the Great Recession.
The filings have increased as the sweeping lockdowns to contain the new coronavirus have devastated the US and global economy. Over a decade ago, in May 2009, 29 companies filed for bankruptcy, according to Bloomberg.
The year-to-date picture tells the same story. So far in 2020, there have been 98 bankruptcies by major companies, the most since 142 companies filed in the first four months of 2009.
It’s likely that the big bankruptcies will continue. Even as the US begins to reopen its economy, many companies will not have survived the shutdown, or won’t be able to keep up with a hit to demand in the immediate future.
“I think we’re going to continue to see filings of at least the level we’re seeing for a while,” Melanie Cyganowski, a former bankruptcy judge now with the Otterbourg law firm, told Bloomberg.
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