WASHINGTON (Reuters) – U.S. bankruptcies surged in March to the highest level in a year, driven by a 41% jump in month-to-month filings by consumers, data firm Epiq AACER reported on Monday.
Overall commercial filings also increased, though the Chapter 11 bankruptcy used by larger companies fell, the firm said.
U.S. bankruptcies had declined through much of the pandemic year, a fact Epiq AACER officials suspected was just a delay in filings due to the flow of fiscal support to consumers or even courthouse closures during the peak of the pandemic.
That may now be reversing. All noncommercial filings increased by nearly 12,000 in March to just over 41,000, the company reported.
With vaccines being distributed and the economy recovering, bankruptcies may also return closer to the pre-pandemic trend, said Epiq AACER Senior Vice President Chris Kruse.
The decline in Chapter 11 filings, to 384 for the month, was “a direct reflection of both lenders and owners working with companies to protect their investments outside of a bankruptcy process,” said Epiq’s senior managing director of corporate restructuring, Deirdre O’Connor.
(Reporting by Howard Schneider in Washington; Editing by Chris Reese and Matthew Lewis)