Canadian bank notes are seen in Ottawa on Wednesday, September 6, 2017. The Office of the Superintendent of Bankruptcy says the total of number of insolvency filings grew by 9.3 per cent to 140,858 last year with consumers leading the way and business filings rising for the first time since 2001. THE CANADIAN PRESS/Adrian Wyld

Canadian consumer, business insolvency filings grew by 9% in 2019: report

More than 97 per cent of insolvency filings were by consumers

The total of number of insolvency filings grew by 9.3 per cent to 140,858 last year with consumers leading the way and business filings rising for the first time since 2001, says statistics released Monday by the Office of the Superintendent of Bankruptcy.

More than 97 per cent of insolvency filings were by consumers. Despite solid jobs numbers, consumer filings rose 9.5 per cent to reach the second highest level on record after 2009 at the end of the Great Recession.

“The sheer number of Canadians struggling with their finances is alarming but the growth in consumer insolvencies and the accelerating insolvency rate is a symptom of a bigger problem: many who have amassed unmanageable debts have no path out,” stated Andre Bolduc, board member of the Canadian Association of Insolvency and Restructuring Professionals (CAIRP).

Ontario had the most insolvency filings at 45,754, which grew by 15 per cent from the prior year. Newfoundland and Labrador’s total filings grew 15.4 per cent, Alberta by 14.5 per cent and British Columbia 10.4 per cent.

The overall increase in insolvencies came as the total number of personal and business cases in the fourth quarter of 2019 climbed 9.8 per cent from the same period a year earlier.

The number of business insolvency filings in the fourth quarter were down 4.1 per cent compared with the fourth quarter of 2018, but up 9.7 per cent compared with the third quarter of 2019. Filings grew 2.8 per cent for the year.

The mining, oil and gas sector lead the way with a 75 per cent increase in the number of insolvency filings in 2019 over 2018. Among business filings, Manitoba was the hardest hit with filings rising by more than 39 per cent, followed by the Atlantic provinces at 38 per cent.

Consumer insolvencies grew partly because interest rates increased between 2016 to 2018, with a two to three-year lag, said Bolduc.

The household debt-to-income ratio increased to 175.86 in the third quarter, but remains below the 2018 record high of 177.82.

“If consumers continue to moderate their spending habits, this should help dampen the rate of increase in consumer insolvency filings,” he said.

But consumer insolvency filings will continue to grow this year as many Canadians have amassed unmanageable debt loads, said CAIRP.

“The indebtedness across Canadian households is likely to way on credit trends as we move forward,” added Craig Fehr, Canadian markets strategist, Edward Jones

READ MORE: Bankruptcies down in British Columbia in 2018 compared to 2017

The Canadian Press


Like us on Facebook and follow us on Twitter.

Bankruptcies

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Comments are closed

Just Posted

CNC Burns Lake campus produces eight nurses from their Practical Nursing program

The campus hosts a mini-celebration for the graduating nurses

QUIZ: Put your knowledge of Canada to the test

How much do you know about our country?

The family of geese floating over Tchesinkut Lake

A Burns Lake local Diane Killman shared this photo of a geese… Continue reading

Lucas Philips named the Youth Citizen of the year in Burns Lake

Lucas Phillips has been awarded the Burn Lake Rotary club’s Bill Gilgan… Continue reading

All community COVID-19 outbreaks declared over in B.C.

Abbotsford manufacturer cleared by Dr. Bonnie Henry

B.C. First Nations vow to keep fighting after Trans Mountain pipeline appeal denied

Squamish Nation, Tsleil-Waututh Nation and Coldwater Indian Band made the application

‘Queue jumpers’ not welcome in B.C. as COVID-19 U.S. cases rise: Horgan

Premier Horgan said he’s heard concerns that Americans have stopped at Vancouver hotels instead of heading to their destination

US officer resigns after photos, connected to death of black man in 2019, surface

Elijah McClain died, last summer, after police placed him in a chokehold

Black worker files discrimination complaint against Facebook

Oscar Veneszee, Jr. has worked as an operations program manager at Facebook since 2017

Ottawa jail inmates argue anti-COVID measures a breach of charter rights

The prisoners allege guards did not wear masks until April 25

Nestle Canada selling bottled water business to local family-owned company

The Pure Life bottled water business is being sold to Ice River Springs

US unemployment falls to 11%, but new shutdowns are underway

President Donald Trump said the jobs report shows the economy is “roaring back”

Most Read