Visualized: U.S. Corporate Bankruptcies On The Rise

By U Cast Studios
August 22, 2023

Visualized: U.S. Corporate Bankruptcies On The Rise
Image Courtesy Of Visual Capitalist

U.S. Corporate Bankruptcies on the Rise

In March, Silicon Valley Bank collapsed, plunging its parent company SVB Financial Group into bankruptcy a week later.

This article was written by Dorothy Neufeld and originally published by Visual Capitalist.

While many expected a wave of bank failures to follow, much of this has since been averted—but cracks have begun to emerge with Moody’s recent downgrading of 10 small and mid-sized banks.

Across the wider corporate landscape, bankruptcies have begun to tick higher. Overstretched balance sheets coupled with 11 interest rate hikes since last year have added to mounting challenges for companies across many sectors.

This graphic shows the surge in corporate bankruptcies in 2023 based on data from S&P Global.

U.S. Corporate Bankruptcies Grow

So far in 2023, over 400 corporations have gone under. Corporate bankruptcies are rising at the fastest pace since 2010 (barring the pandemic), and are double the level seen this time last year.

Below, we show trends in corporate casualties with data as of July 31, 2023:

Year of Filing Bankruptcy Filings
as of July
Annual Total
2023 402 N/A
2022 205 373
2021 256 408
2020 407 639
2019 334 590
2018 317 518
2017 305 520
2016 354 576
2015 292 525
2014 273 471
2013 349 558
2012 362 586
2011 364 634
2010 530 827

Represents public or private companies with public debt where either assets or liabilities are greater than or equal to $2 million, or private companies where assets or liabilities are greater than or equal to $10 million at time of bankruptcy.

Firms in the consumer discretionary and industrial sectors have seen the most bankruptcies, based on available data. Historically, both sectors carry significant debt on their balance sheets compared to other sectors, putting them at higher risk in a rising rate environment.

Overall, U.S. corporate interest costs have increased 22% annually compared to the first quarter of 2021. These additional costs, combined with higher wages, energy, and materials, among others, mean that companies may be under greater pressure to cut costs, restructure their debt, or in the worst case, fold.

Billion-Dollar Bankruptcies

This year, 16 companies with over $1 billion in liabilities have filed for bankruptcy. Among the most notable are retail chain Bed Bath & Beyond and the parent company of Silicon Valley Bank.

Company Primary Sector Date
Party City Consumer Discretionary Jan 2023
Serta Simmons Bedding Consumer Discretionary Jan 2023
Avaya Information Technology Feb 2023
Diamond Sports Communication Services Mar 2023
SVB Financial Financials Mar 2023
LTL Management N/A Apr 2023
Bed Bath & Beyond Consumer Discretionary Apr 2023
Whittaker, Clark & Daniels N/A Apr 2023
Monitronics Industrials May 2023
Kidde-Fenwal Consumer Discretionary May 2023
Envision Healthcare Healthcare May 2023
Diebold N/A Jun 2023
Wesco Aircraft Industrials Jun 2023
PGX Holdings Industrials Jun 2023
Cyxtera Information Technology Jun 2023
Voyager Aviation Industrials Jul 2023

Mattress giant Serta Simmons filed for bankruptcy early this year. It once made up nearly 20% of bedding sales in America. With a vast share of debt coming due this year, the company was unable to make payments due to higher borrowing costs.

What Comes Next?

In many ways, U.S. corporations have been resilient despite the sharp rise in borrowing costs and economic uncertainty.

This can be explained in part by stronger than anticipated profits seen in 2022. While some companies have cut costs, others have hiked prices in an inflationary environment, creating buffers for rising interest payments. Still, S&P 500 earnings have begun to slow this year, falling over 5% in the second quarter compared to last year.

Secondly, the structure of corporate debt is much different than before the global financial crash. Many companies locked in fixed-rate debt over longer periods after the crisis. Today, roughly 72% of rated U.S. corporate debt has fixed rates.

At the same time, banks are getting more creative with their lending structures when companies get into trouble. There has been a record “extend and amend” activity for certain types of corporate bonds. This debt restructuring is enabling companies to keep operating.

The bad news is that corporate debt swelled during the pandemic, and eventually this debt will come due likely at much higher costs and with more severe consequences.

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