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FOR IMMEDIATE RELEASE                                       


Contact: Pam Shepherd        

(703) 739-0800



Third Quarter Figure Lowest Since September 1996


November 22, 2000, Alexandria, Va. — Bankruptcies decreased by 6.8 percent in the 12-month period ending Sept. 30 from the prior year.  Filings dropped from 1,354,376 in fiscal year 1999 to 1,262,102, according to data released yesterday by the Administrative Office of the U.S. Courts. Although bankruptcies still top the one million mark, the steady decline in filings that began last year continues.


In fiscal year 2000, the largest number of filings continues to be under chapter 7.  Total chapter 7 filings, however, fell 9.2 percent to 870,805, down from 959,291 in 1999. Chapter 13 filings, the next largest category, fell 1.1 percent to 380,880 from 385,262. Chapter 12 filings also decreased to 551, down from 811 in 1999.  Chapter 11 filings, the only category to increase this quarter, rose 9.5 percent from 8,982 in 1999 to 9,835 in 2000.


The overwhelming number of filings continues to be non-business filings. In fiscal 2000, non-business filings were 97 percent of the total cases.  Since 1993, business cases have declined by 44 percent, from 64,857 to 36,065 in 2000.  New filings during the three months ending September 30 were 308,718, the lowest figure for a quarter since September 1996.  New filings in a single quarter peaked at 373,460 in June 1998.  While national filings have dropped over 12 percent since 1998.  Private forecasts from Visa, USA and SMR Research project that national filings will resume an upward trend during 2001.


“While the latest figures are consistent with a sustained modest decline in bankruptcies, next year could see the start of another rise in filings,” said Samuel J. Gerdano, Executive Director of the American Bankruptcy Institute.  “Historically, consumer filings trend upward after a temporary decline, as interest rates creep up,” he added.


Personal (non-business) bankruptcies for the quarter decreased to 1,226,037 (also down 6.8 percent when compared to the third quarter of 1999), and personal filings for the 12-month period ending September 2000 decreased 9.1 percent over the 935,792 filings in the same period for 1999.  Business filings were down from 38,625 to 36,065, which is a 6.6 percent decrease.


The chapter* breakdown of personal filings for the 12-month period ending Sept. 30 is: 870,805 chapter 7s; 9,835 chapter 11s; and 380,065 chapter 13s.  Chapter 7 bankruptcies represented 69 percent of all personal bankruptcies during the 12-month period.


The chapter breakdown of personal filings for the second quarter is: 850,118 chapter 7s; 700 chapter 11s; and 375,219 chapter 13s.  Chapter 7 bankruptcies represent 71 percent of all personal bankruptcy filings during the quarter.


Districts with the Highest Percentage Decrease in Filings (Business and Personal)

From Oct. 1, 1999 to Sept. 30, 2000


  1. Northern District of California                                  27%
  2. Southern District of California                                  22.1%
  3. Central District of California                                    21%
  4. District of the Virgin Islands                                     20%
  5. Tie: District of Vermont & District of Hawaii          18.5%


Districts with the Highest Percentage Increase in Filings (Business and Personal)

From Oct. 1, 1999 to Sept. 30, 2000


  1. District of Guam                                            50.5%
  2. District of Delaware                                      16.3%
  3. Southern District of Alabama                        10.6%
  4. Eastern District of Louisiana                        8.4%
  5. District of Utah                                              5.7%

ABI is the largest multi-disciplinary, non-partisan organization dedicated to research and education on matters of insolvency. ABI is not an advocacy group. Instead, ABI was founded in 1982 to provide Congress, its members, journalists and the public-at-large with an unbiased analysis of bankruptcy issues.  ABI’s membership includes more than 7,600 attorneys, bankers, judges, lenders, professors, turnaround specialists, accountants and other bankruptcy professionals providing a forum of the exchange of ideas and information. For additional information visit ABI World at

*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 recognize 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, 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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