PERSONAL BANKRUPTCIES TOP ONE MILLION IN RECORD-SETTING 3rd QUARTER
Contact: Scott Relyea at (703)
1997 American Bankruptcy Institute
ALEXANDRIA, Va., December 9, 1996 -- Personal bankruptcies continue to set new
national records, according to data released today by the Administrative Office of the U.S.
Courts. A total of 1,058,444 individuals filed for bankruptcy during the 12-month period
ended September 30, 1996. This figure again represents approximately 95 percent of the
total business and personal filings for the period, which stood at 1,111,964, also a record.
The third quarter of 1996 marks the first time in history filings for a single quarter
averaged more than 100,000 per month, standing at 303,309 total business and
non-business filings for the period July 1 through September 30, 1996. During this time a
record 290,111 of these were personal filings.
Total filings for the third quarter represents a 14 percent increase over the first
quarter's totals of 266,149 and a 30 percent increase over the third quarter of 1995. Each
of the three quarters in 1996 have successively set records, eclipsing the previous high for
a single three-month period of 250,622, set in the second quarter of 1992.
The increase in personal bankruptcies again far outpaced the increase in business
bankruptcies, jumping by approximately 34.4 percent over the previous twelve month
period -- total filings increased by 25.9 percent.
"The latest filing statistics are an alarm bell for the financial community and policy
makers alike that rising consumer debt levels can lead to the need to seek bankruptcy
relief," said Samuel J. Gerdano, ABI Executive Director.
For the first time since at least 1980, chapter 11 filings as a percentage of total filings
dipped below one percent at 0.09 percent. Chapter 11 of the Bankruptcy Code is used
predominately to reorganize a business, although individuals with particularly large federal
or state tax obligations may also file under chapter 11.
For the third consecutive quarter, every state in the country recorded an increase over
the previous 12-month period. And the Virgin Islands for the first time this year joined
each of the 93 other federal judicial districts in recording an increase (1.6 percent) for the
period, with only the Eastern District of New York reporting an increase of less than 10
percent (9.3 percent).
The district recording the greatest percentage increase in filings, as compared between
the 12-month periods ended September 30, 1995, and September 30, 1996, was the
Northern District of West Virginia at 50.8 percent. Following close behind at second was
the District of Hawaii with an increase of 49.4 percent. After leading the country in this
category for four consecutive quarters, the Eastern District of Arkansas had the third
highest percentage increase in filings at 47.0 percent.
The remaining districts reporting an increase in filings of more than 40 percent for the
12-month period were: Middle District of Louisiana (45.9 percent); District of Guam
(44.7 percent); Middle District of North Carolina (43.4 percent); Western District of
North Carolina (42.1 percent); Southern District of Alabama (42.1 percent); District of
New Mexico (41.5 percent); District of Wyoming (41.2 percent); and Western District of
Louisiana (40.6 percent). The Central District of California remained the district reporting
the largest number of filings in the country with 97,311 for the three-month period.
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 5,200 attorneys, bankers, judges, professors, turnaround specialists,
accountants and other bankruptcy professionals providing a forum for the exchange of
ideas and information. For more information on ABI, visit ABI World at http://www.abiworld.org.
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