Puerto Rico bankruptcies up nearly 20% YOY in August
Filings for the year have jumped by more than a third.
So far this year, 3,710 petitions have been filed at the U.S. Bankruptcy Court, representing a 33.9% jump when compared to the same period last year.
The number of bankruptcy cases filed in Puerto Rico increased by 19.7% year-over-year in August, with 427 cases filed compared to 394 during the same month last year, according to research firm Boletín de Puerto Rico.
So far this year, 3,710 petitions have been filed at the U.S. Bankruptcy Court, representing a 33.9% jump compared to the same period last year, when 2,270 filings were recorded from January to August.
The data show that Chapter 7 cases from petitioners seeking total liquidation of assets were up 11.3% for the eight-month period, with 1,191 filings compared to 869 during the same period last year, making it the leading category of filings so far this year.
Next up were Chapter 13 filings, or personal bankruptcies, which showed a 33.3% year-over-year increase in August, with 2,470 cases submitted, up from 1,852 cases during the same period in 2023.
Meanwhile, there have been 39 petitions for Chapter 11 protections so far this year, which allow debtors to work through their financial situation while managing their business, representing a 15.2% drop compared to the 46 petitions filed during the same period last year.
Chapter 12 cases, available only to farmers, surged by 233% year-over-year, with 10 cases filed by August. That number compares to only three cases on record for the same eight-month period in 2023, Boletín de Puerto Rico data show.
So far this year, a total of 228 commercial bankruptcies were filed, marking a 26.76% increase compared to the 180 bankruptcies recorded during the same period in 2023.
The economic sectors most affected by bankruptcies from January to August 2024 include:
- Restaurants: 17 filings, representing 11.72% of the total. The filings carry a total debt of more than $7.3 million
- Construction industry: 10 bankruptcies (6.9% of reported petitions), with more than $5.5 million in debt.
- Agriculture: Seven bankruptcies (4.83% of reported petitions), with more than $7.6 million in debt.
- Medical doctors: Eight filings (5.52% of reported petitions), with nearly $6.6 million in debt.
The total reported debt for January-August 2024 stands at $485.5 million, a 37.33% reduction from the $774.6 million reported in 2023. However, when adjusting for the bankruptcy of HIMA Hospitals, which accounted for $472.3 million of the 2023 total, the adjusted debt for that year is $302.3 million, Boletín de Puerto Rico stated.
“With this adjustment, the increase in reported debt in 2024 would be 60.5% compared to the adjusted total for 2023,” the firm noted.
