Surge in Corporate Bankruptcies in Germany by 22.1% in 2023

The latest data released on Friday revealed a 22.1% surge in corporate bankruptcies in Germany in 2023 compared to the previous year.

Economic slowdown, rising inflation rates, and interest rates contributed to more companies facing insolvency.

Approximately 17,814 companies filed for bankruptcy last year, with creditors' claims totaling around 26.6 billion euros, according to Federal Statistical Office data.

The number increased by 5% compared to 2019 pre-pandemic levels but remains significantly lower than the 32,687 bankruptcies during the 2009 global financial crisis, Reuters reported.

Several well-known companies, particularly in the retail clothing sector, declared bankruptcy last year, including Peek & Cloppenburg, Gerry Weber, Reno, Salamander, and Görtz.

The German Chamber of Industry and Commerce (DIHK) anticipates more bankruptcy cases this year, with a survey showing a quarter of companies struggling with doubtful debts.

Mark Evers, an expert at the chamber for medium-sized companies, stated, "Unfortunately, another increase in corporate bankruptcies can be expected in the coming months."

Regular bankruptcy cases rose by 18.1% year-on-year in February.

Germany, Europe's largest economy, contracted by 0.3% last year due to persistent inflation, energy price hikes, and weak external demand.