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FOR IMMEDIATE RELEASE                               

Contact: Rali Mileva          

(703) 739-0800

rmileva@abiworld.org

Record Breaking Bankruptcy Filings Reported in 2002

February 14, 2003, Alexandria, Va. --Bankruptcy filings continue to break historic records, according to data released today by the Administrative Office of the U.S. Courts. Total bankruptcies filed in calendar year 2002 totaled 1,577,651, up 5.7 percent from the 12-month period ending Dec. 31, 2001, when filings reached 1,492,129. Non-business filings accounted for the overwhelming majority, 97.6 percent, of all bankruptcy cases filed in calendar year 2002. Non-business filings increased again in 2002, totaling 1,539,111, while business filings fell by 1,559 cases. The number of bankruptcies filed during the last three months of calendar year 2002 (Oct. 1-Dec. 31, 2002) was 395,129. That's up 8.3 percent from the 364,921 filings for the three-month period ending Dec. 31, 2001.

"As expected, the fourth quarter 2002 filings continued a record setting pace," said Samuel J. Gerdano, ABI Executive Director. "With historically high levels of consumer debt and many public companies in financial distress, we expect 2003 to continue this pace," he said.

Of the total number of bankruptcy filings for the 12-month period ending Dec. 31, 2002, chapter 7 filings were up 5.2 percent, from 1,054,975 in the same period in 2001 to 1,109,923 in 2002. The next largest group of filings was chapter 13, at 455,877, up 7.2 percent from the 425,292 filings in calendar year 2001. Chapter 11 filings fell 1.3 percent to 11,270 in calendar year 2002, from the 11,424 chapter 11 filings in 2001. Chapter 12 filings rose 26.6 percent in 2002, from 383 in 2001 to 485 in 2002.

BUSINESS filings for the 3-month period ending Dec. 31, 2002, totaled 9,500, down 5.1 percent from the 10,013 bankruptcy business cases filed in the same period in 2001. NON-BUSINESS filings for the 3-month period ending Dec. 31, 2002, increased 8.6 percent from 354,908 in 2001 to 385,629 in 2002.

The chapter* breakdown of BUSINESS filings for the 3-month period ending Dec. 31, 2002, is: 5,472 chapter 7s; 2,548 chapter 11s; and 1,274 chapter 13s; and 179 chapter12s.

The chapter breakdown of NON-BUSINESS filings for the 3-month period ending Dec. 31, 2002, is: 270,527 chapter 7s; 224 chapter 11s; and 114,874 chapter 13s.

Districts with the Highest Percentage INCREASE in Total Filings for the 12-month period ending Dec. 31, 2002 (compared to the identical period in 2001)

1. District of Guam 31.6%
2. Eastern District of Michigan 21.9%
3. Middle District of Alabama 19.5%
4. District of Arizona 16.5%
5. Western District of Missouri 15.8%

Districts with the Highest Percentage DECREASE in Total Filings for the 12-month period ending Dec. 31, 2002 (compared to the identical period in 2001)

1. District of Delaware 11.0%
2. District of Hawaii 10.9%
3. District of Wyoming 9.1%
4. District of the Virgin Islands 7.6%
5. District of North Dakota 7.0%

More information will be available on Monday at http://www.abiworld.org/stats/newstatsfront.html.

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ABI is the largest multi-disciplinary, non-partisan organization dedicated to research and education on matters related to insolvency. ABI was founded in 1982 to provide Congress and the public with unbiased analysis of bankruptcy issues. The ABI membership includes more than 9,000 attorneys, accountants, bankers, judges, professors, lenders, turnaround specialists and other bankruptcy professionals, providing a forum for the exchange of ideas and information. For additional information on ABI, visit ABI World at http://www.abiworld.org. For additional conference information, visit http://www.abiworld.org/conferences.html.

*Definitions from Bankruptcy Overview: Issues, Law and Policy, by the American Bankruptcy Institute

Chapter 7 of the Bankruptcy Code is available to both individual and business debtors. Its purpose is to achieve a fair distribution to creditors of the debtor's available non-exempt property. Unsecured debts not reaffirmed are discharged, providing a fresh financial start.

Chapter 11 of the Bankruptcy Code is available for both business and consumer debtors. Its purpose is to rehabilitate a business as a going concern or reorganize an individual's finances through a court-approved reorganization plan.

Chapter 12 of the Bankruptcy Code is designed to give special debt relief to a family farmer with regular income from farming.

Chapter 13 of the Bankruptcy Code is available for an individual with regular income whose debts do not exceed specific amounts; it is typically used to budget some of the debtor's future earnings under a plan through which creditors are paid in whole or in part.


 

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