Greater Toronto Insolvencies Rise Over 18%

Greater Toronto insolvencies are following the rest of the country towards multi-year highs. Office of the Superintendent of Bankruptcy (OSB) filings show the number of insolvencies increased in February. This is a general trend that has been occurring across the country. Greater Toronto insolvencies are growing at a faster rate than Ontario as a whole, which is the fastest growing province in Canada.

Greater Toronto Insolvencies Rise Over 18%

Greater Toronto insolvencies are rising very quickly, even for a city in Ontario. Toronto saw 1,523 insolvency filings in February, up 18.43% from last year. Breaking that number down, consumers represented 1,485 of the filings, up 17.95% from last year. Businesses represented just 38 filings, but that’s up 40.74% from last year. For context, Ontario has one of the fastest climbing rates in the country, at 16.80% higher than last year.

Greater Toronto Insolvency Filings

The number of insolvency filings made in February 2020, for both Greater Toronto and ON

Source: OSB, Better Dwelling.

Consumers Liabilities In Filings Rise Over 4%

The amount of liabilities held by Greater Toronto consumers filing for bankruptcy, is rising. Households reported $146.92 million in liabilities for February, up 4.62% from last year. The average liability fell to $98,937 per consumer filer, down 11.30% from last year. More liabilities in total, but consumers are filing at a lower average.

Businesses Are Seeking Protection From Creditors Earlier

Greater Toronto businesses have been filing for insolvency as well, with a more extreme trend. Despite more filings, the amount of liabilities fell to $41.50 million in February, down 37.02% from last year. Due to the increase of filers, that drops the average liability to $1,092,128, down 55.25% from last year. Businesses are also seeking insolvency protection at much lower levels than last year.

Greater Toronto Insolvency Growth

The percent change for insolvency filings made in February 2020, compared to a year before.

Source: OSB, Better Dwelling.

Rising insolvencies have been a general trend across Canada for the past year. Going into March, after the pandemic was declared, some filers may receive a lifeline. This would pause in the number of filings seen – or at least slow them down. However, before the pandemic, insolvencies had been rising to Great Recession levels.

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