German government does not yet see an alarm signal in the latest insolvency figures
The German government is taking the latest insolvency figures seriously, but sees no alarm signal in the long-term perspective. A spokesperson for the Green-led Economy Ministry said in Berlin on Wednesday that there is indeed a strong dynamic, with the pre-Corona level having been surpassed meanwhile. However, there is no broad insolvency wave. In the long-term 20-year comparison, the current level is not remarkable. Recently, rather medium-sized and large companies have been affected.
"Handelsblatt" reported on Tuesday that in the first six months of 2024, 162 companies with more than ten million euros in turnover had fallen into financial distress, an increase of 41% compared to the previous year-quarter. The newspaper based this on an analysis by the restructuring consulting firm Falkensteg. According to other researchers, the number of bankruptcies in June sank for the second time in a row. In total, there were 1,169 insolvencies of individuals and corporations in Germany in the previous month, according to calculations by the Institute for Economic Research Halle. This represents a decrease of eight percent compared to the previous month. However, an increase is expected for July.
The deputy government spokesperson Christiane Hoffmann said that the growth initiative announced by the traffic light coalition - a package of 49 individual measures - should improve the framework conditions for companies. This is also a reaction to the trend towards more insolvencies.
The latest report by "Handelsblatt" serves as an alarm signal, as it indicates a 41% increase in insolvencies among companies with substantial turnovers in the first half of 2024 compared to the previous year-quarter. Nevertheless, the Federal Government maintains that there's no alarm signal in the long-term perspective, as a comparison over the past 20 years shows a non-remarkable insolvency level.
