Thanks to special corona rules: Fewer company bankruptcies in the first half of the year

The feared wave of company bankruptcies has not yet been reflected in the official statistics.

With 7408 cases, the number of corporate insolvencies in the first half of the current year was even 17.7 percent below the value in the first six months of 2020. According to the Federal Statistical Office on Friday, the level of the first half of the year, which was not influenced by the Corona crisis, was also increased 2019 fell 22.9 percent.

“It can be assumed that the state economic aid for companies and the obligation to file for insolvency, which will only apply again from May, contributed to the low insolvency figures in the first half of 2021,” said the Wiesbaden statisticians.

In June, the number of company bankruptcies was 1197 cases, 11.6 percent below the level of the same month last year.

The obligation to file for insolvency applies again

In order to prevent a wave of bankruptcies in the Corona crisis, the state temporarily suspended the obligation to file for bankruptcy when a reason for insolvency such as over-indebtedness or insolvency occurred.

Since May 1st, the obligation to file for insolvency has been fully applicable again.

According to the Federal Office, the claims of creditors from corporate insolvencies in the first half of 2021, at 31.8 billion euros, were almost twice as high as a year earlier (16.7 billion euros). This is due to the fact that in the current year more economically important companies started going to the local court. The largest number of cases in the first six months were in construction (1,219) and in commerce (1,120).

Experts assume that there will be no wave of insolvencies in Germany in the coming year.

"The state aid measures to mitigate the consequences of the pandemic continue to influence the development of the insolvency figures," said the chairman of the professional association of insolvency administrators (VID), Christoph Niering.

"The recognizable willingness to take further support measures - even in a new government - will not fundamentally change this trend until 2022."

Researchers expect "backwater"

According to a study, the number of company bankruptcies has recently even fallen to a record low: Only 570 partnerships and corporations were reported as insolvent in August, as the Institute for Economic Research Halle (IWH) found. That is eleven percent less than in the previous month and 15 percent less than in the same month last year. The data is based, among other things, on bankruptcy notices from the registration courts and company balance sheets.

"Due to government support measures, the persistently low insolvency figures do not reflect the actual insolvency events," explained IWH researcher Steffen Müller.

"In order to avoid an ever-increasing backlog of bankruptcies, ongoing support measures should be quickly checked." The short-time working allowance was important for the stabilization of the economy when the pandemic broke out, but currently it is still "undifferentiated, even for failed companies in industries who are not affected by the pandemic and are experiencing a boom, ”stated Müller.

Significantly more consumer bankruptcies

By contrast, the number of consumer bankruptcies rose by leaps and bounds by June.

42,304 were reported - a good 51 percent more than in the first half of 2020. "The sharp increase is to be seen in connection with a law to gradually shorten residual debt discharge procedures from six to three years," said the statisticians.

The new regulation applies to procedures applied for from October 1, 2020.

It enables those affected to make a quicker economic fresh start afterwards.

"It can therefore be assumed that many over-indebted private individuals initially withheld their bankruptcy petition in order to benefit from the new regulation."