The Office of the Superintendent of Bankruptcy Canada figures for December 2021 show a decrease of almost 16%
The number of Canadian individuals and businesses whose financial circumstances lead to insolvency action declined as last year ended.
Official statistics from the Office of the Superintendent of Bankruptcy Canada show a 15.7% decrease month-over-month in bankruptcies and proposals. There was a 6.7% in the 12 months ended December 31, 2021.
Canadian insolvency firm MNP Debt reported last month that the rising cost of living means that 45% of respondents to the firm’s survey are not confident that they can pay their bills this year.
High levels of debt and rising interest rates may mean the latest insolvency stats are the calm before a storm.
December’s figures for consumers (97% of all insolvency filings in 2021), show an annual decrease of 6.7%, with bankruptcies down 16.5% and proposals down 1.5%. Proposals accounted for almost 7 in 10 consumer insolvencies in 2021.
Meanwhile, business insolvencies were down 11% year-over-year with retail trade, and accommodation and food services seeing the largest decreases. Construction, and transportation and warehousing posted the largest increases.
For those who started 2022 in precarious financial positions, the decision of the BoC to hold interest rates will have offered relief for now.
How many people were insolvent?
While the percentages are positive, there were still 92,572 people and businesses that filed for insolvency in 2021 with 7,020 filing in December.
Consumers made up 90,092 of the filings, broken down into 27,461 bankruptcies and 62,631 proposals. Meanwhile, 2,480 businesses filed for insolvency in 2021 including 1,942 bankruptcies and 538 proposals.
The top 3 regions for consumer insolvencies in 2021 were:
- Ontario (30,327)
- Quebec (23,667)
- Alberta (13,956).
The top 3 regions for business insolvencies in 2021 were:
- Quebec (1,530)
- Ontario (613)
- Alberta (139)
