Bankruptcy Update

Personal bankruptcy filings have stabilized over the past two months. Unfortunately, the level is approximately 20 percent above that observed a year ago. Given the sharp drop in both consumer confidence and economic activity following the terrorist attacks on September 11, it seems quite likely now that the year-end total will exceed 1.5 million. The charts below display data provided by Visa's Bankruptcy Notification Service. As of September 22, 2001 personal bankruptcy filings in the U.S. this year totaled 1,071,624, up 21.5 percent from the same 38-week period ending one year earlier. Interestingly, while all regions of the country have experienced strong growth in bankruptcies, the hardest hit are the North Central and South regions. During the escalation in filings in the mid-1990s, California exhibited some of the strongest growth in the nation, but this year the Pacific Region (including California) has the lowest growth rate of all the regions.

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