Downward Bankruptcy Filing Trend Continues

Bankruptcy filings for March continued to show a year-over-year decline. According to the latest release from Epiq Systems, there were an average of 5,550 daily bankruptcy filings in March, which represented a 12.8% decline from the same time last year. This decline keeps with the same trend we have been seeing for the past eleven months.

Extrapolating from the first quarter of 2012 and based on the experience of the immediate past three years, a projection for total bankruptcy filings this calendar year would be in the 1.21 - 1.25 million range. My projection of a 9 - 12% decline in bankruptcy filings for 2012 is somewhat higher than the projection from Fitch for a 4 - 5% decline. Although the Fitch projection is not outside the realm of possibility, it would require a historically unusual pattern where bankruptcy filings stay closer to their peak in the annual cycle that sees February and March as the months with the highest U.S. daily bankruptcy filing rate.