Corporate bankruptcies begin to rise for the first time in four years

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Corporate bankruptcies begin to rise for the first time in four years
Corporate bankruptcies begin to rise for the first time in four years
9 July, 11:07Economy
During the period from January to June 2021, 4,918 legal entities were declared insolvent in Russia, which is 9.2% more than last year, when more than six thousand companies were declared bankrupt in the first half of the year.

This growth was recorded for the first time in four years. Experts see the reason for the trend, among other things, in the tightening of practice in terms of subsidiary liability - when the owner has to pay off the debts of an enterprise out of his own pocket.

Moreover, today there are fewer bankruptcies registered than before the pandemic, but these indicators do not accurately reflect the situation. The duration of bankruptcy proceedings is from seven to nine months, and the moratorium imposed for the period of the covid pandemic was lifted only on January 7. Coface analysts are confident that this moratorium did not become a lifeline for the business, but only delayed its collapse. Experts suggested waiting for deferred bankruptcies in the third and fourth quarters.

According to Rosstat, at the end of April, overdue accounts payable in the amount of 3.999 trillion rubles "hung" on 6.066 thousand Russian firms. 2.666 trillion companies are in debt to suppliers, 90.8 billion to the state, including taxes (56.8 billion rubles) and payments to off-budget funds (34 billion rubles).

Experts point out that the main risk remains the third wave of the pandemic, in which the authorities in some regions have tightened quarantine restrictions. In the first quarter, the sharp rise in late payments was canceled. We are talking about healthcare and pharmaceuticals, as well as petrochemicals. Passenger traffic remains in the "credit" risk zone, as does the entertainment industry.

Meanwhile, the number of citizens' bankruptcies is also growing. In the first six months of 2021, the figure exceeded the figures for the whole of 2019. Moreover, experts predict: this is only the beginning. According to statistics, over the past six months the courts have declared bankruptcy of 88 thousand Russians, while a year ago there were only 42.7 thousand such decisions. In total, since 2015, 370 thousand people have become bankrupt, of which almost a quarter were bankrupts this year.

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