Bankruptcies Increase in Numbers - The rate of corporate bankruptcies keeps increasing.
The number of companies filing for insolvency in Germany is on the rise. In the initial three months of the current year, there were 5209 businesses seeking financial protection, a 26.5% increase from the previous quarter as reported by the Federal Statistical Office. This number also surpassed the first quarter of 2020 by 11.2%. Notably, the latter quarter saw relatively low insolvency rates due to special regulations in place during the coronavirus crisis.
Starting in May 2024, there's been a consistent increase of double-digit percentages compared to the previous year. Statisticians in Wiesbaden attribute this to the worsening financial situations of companies. Insolvency cases only show up in the statistics after a court's initial decision, which is usually made several months after the application date.
Industry experts predict that the country will see around 20,000 such cases in total by the end of the current year. This potential surge may be attributed to high energy costs, increasing interest rates, and the expiration of special government regulations put in place to prevent a widespread wave of insolvencies during the pandemic.
In 2023, the Federal Statistical Office recorded 17,814 corporate insolvencies, which is relatively low compared to Germany's long-term history. This figure pales in comparison to a staggering 33,000 companies that fell into insolvency during the financial and economic crisis of 2009.
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The increase in corporate bankruptcies is not exclusive to the current year in Germany. According to Destatis, the German Federal Statistical Office, there was a significant surge in company insolvencies in May 2024, marking a consistent trend of double-digit percentage increases compared to the previous year.
The high number of company bankruptcies in Germany can be linked to the worsening economic situation, as reported by statisticians in Wiesbaden. This includes factors such as high energy costs, increasing interest rates, and the expiration of special government regulations put in place to prevent insolvencies during the coronavirus crisis.
The coronavirus crisis had a significant impact on company bankruptcies in Germany. While the first quarter of 2020 saw relatively low insolvency rates due to special regulations, the latter part of the year saw a decrease in insolvency cases.
The Federal Statistical Office recorded 17,814 corporate insolvencies in 2023, which is relatively low compared to Germany's long-term history. However, this figure pales in comparison to the staggering 33,000 companies that fell into insolvency during the financial and economic crisis of 2009.
