May 24th, 2024

Business insolvencies spike in first quarter, consumer insolvencies also rise

By The Canadian Press on May 3, 2024.

Business insolvencies almost doubled year over year in the first quarter of 2024, while consumer insolvencies reached their highest level since the last pre-pandemic quarter. A commercial retail space is advertised for lease along King Street West in Toronto on March 9, 2021. THE CANADIAN PRESS/Tijana Martin

OTTAWA – Business insolvencies surged 87.2 per cent year-over-year in the first quarter of 2024, while consumer insolvencies rose 14 per cent.

Data from the Office of the Superintendent of Bankruptcy shows business insolvencies totalled just over 2,000, with about 1,600 of those being bankruptcies.

The Canadian Association of Insolvency and Restructuring Professionals says that’s by far the largest year-over-year increase in business insolvencies in 37 years of records.

Business insolvencies rose 31.7 per cent from the fourth quarter of 2023.

The association says it’s seeing signs of a significant rise in distress among Canadian businesses as they deal with pandemic debt, higher costs, declining consumer spending and higher interest rates.

Consumer insolvencies during the first quarter totalled almost 34,000, with the majority being proposals.

This report by The Canadian Press was first published May 3, 2024.

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