Commentary

Read more about debtors with a business related personal insolvency in the June quarter 2017.

Proportion of debtors with a business related personal insolvency in Australia

Key points

  • In the June quarter 2017, 16.0% of debtors entered a business related personal insolvency.  This is a fall from 16.5% in the March quarter 2017.
  • In the June quarter 2017:
    • economic conditions (401 debtors) was the most common business related cause
    • excessive use of credit (2,485 debtors) was the most common non-business related cause.

Proportion of debtors with a business related personal insolvency

In the June quarter 2017, 16.0% of debtors entered a business related personal insolvency (down from 16.5% in the March quarter 2017). By type of insolvency:

  • 24.1% of bankrupts entered a business related bankruptcy. This proportion did not change from the March quarter 2017.
  • 6.8% of debt agreement debtors entered a business related debt agreement. This is a fall from 7.1% in the March quarter 2017.
  • 35.0% of personal insolvency agreement debtors entered a business related personal insolvency agreement. This is a rise from 22.6% in the March quarter 2017.

Top reasons for bankrupts entering bankruptcies

Business related bankruptcies

When we could identify a specific reason, the most common reasons for entering business related bankruptcies in the June quarter 2017 were:

  • economic conditions (280 bankrupts)
  • excessive drawings (66 bankrupts)
  • personal reasons including ill health (57 bankrupts).

Non-business related bankruptcies

When we could identify a specific reason, the most common reasons for entering non-business related bankruptcies in the June quarter 2017 were:

  • unemployment or loss of income (929 bankrupts)
  • excessive use of credit (704 bankrupts)
  • domestic discord or relationship breakdown (378 bankrupts).

Top reasons for debtors entering debt agreements

Business related debt agreements

When we could identify a specific reason, the most common reasons for entering business related debt agreements in the June quarter 2017 were:

  • economic conditions (114 debtors)
  • excessive interest (36 debtors)
  • lack of business ability (35 debtors).

Non-business related debt agreements or not stated

When we could identify a specific reason, the most common reasons for entering non-business related debt agreements in the June quarter 2017 were:

  • excessive use of credit (1,765 debtors)
  • unemployment or loss of income (977 debtors)
  • domestic discord or relationship breakdown (420 debtors).

Top reasons for debtors entering personal insolvency agreements

Business related personal insolvency agreements

When we could identify a specific reason, the most common reason for entering business related personal insolvency agreements in the June quarter 2017 was economic conditions (7 debtors).

Non-business related personal insolvency agreements or not stated

When we could identify a specific reason, the most common reasons for entering non-business related personal insolvency agreements in the June quarter 2017 were:

  • excessive use of credit (16 debtors)
  • unemployment or loss of income (7 debtors)
  • Ill health (3 debtors)
  • domestic discord or relationship breakdown (3 debtors).