While everyday life in the Corona crisis seems to be slowly moving back towards normality, behind the superficial relaxation lurks the extremely hungry bankruptcy vulture. At first glance, the insolvency figures look good, because they have fallen by 20 percent since the beginning of the year and by as much as 65 percent in April. But the positive impression is deceptive. The decline is not due to the good economic situation, but to the legal standstill in the debt collection system decreed by the Federal Council and the subsequent debt collection holidays, which lasted until April 19. These bankruptcies were postponed, but not lifted. Added to this is the threatening development of recent months, in which various sectors suffered massive losses in turnover as a result of the state ban on events and assemblies. In many cases, the Corona loans were able to avert immediate insolvency for the time being. Nevertheless, Bisnode D&B expects a massive increase in company bankruptcies in the coming months. The number of start-ups also shows how bad the mood among entrepreneurs is. This fell by a whole 25 per cent in April.
Read the study:
Bankruptcies & formations as of April 2020 (in German)