Commentary

Read more about debtors with a business related personal insolvency in the June quarter 2018.

Proportion of debtors with a business related personal insolvency in Australia*

* From the September quarter 2017, geographic coding of personal insolvency statistics follows a new method. For further details see the Guide to business and non-business personal insolvency statistics.

Key points

  • In the June quarter 2018, 17.6% of new debtors entered a business related personal insolvency. This is a rise from 16.1% in the March quarter 2018.
  • In the June quarter 2018, where we could identify a specific cause:
    • economic conditions (363 debtors) was the most common business related cause
    • excessive use of credit (2,407 debtors) was the most common non-business related cause.

Proportion of debtors with a business related personal insolvency

In the June quarter 2018, 17.6% of new debtors entered a business related personal insolvency. This is a rise from 16.1% in the March quarter 2018. By type of personal insolvency:

  • 27.0% of bankrupts entered a business related bankruptcy; this is a rise from 24.1% in the March quarter 2018
  • 6.2% of debt agreement debtors entered a business related debt agreement; this is a fall from 6.8% in the March quarter 2018
  • 27.3% of personal insolvency agreement debtors entered a business related personal insolvency agreement; this is a fall from 37.5% in the March quarter 2018.

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 2018 were:

  • Economic conditions (297 debtors)
  • Excessive drawings (59 debtors)
  • Lack of business ability (53 debtors).

Non-business related bankruptcies or not stated

When we could identify a specific reason, the most common reasons for entering non-business related bankruptcies in the June quarter 2018 were:

  • Unemployment or loss of income (1,063 debtors)
  • Excessive use of credit (667 debtors)
  • Domestic discord or relationship breakdown (415 debtors).

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 2018 were:

  • Economic conditions (62 debtors)
  • Excessive interest (57 debtors)
  • Lack of business ability (25 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 2018 were:

  • Excessive use of credit (1,724 debtors)
  • Unemployment or loss of income (985 debtors)
  • Domestic discord or relationship breakdown (425 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 2018 was economic conditions (four 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 2018 were:

  • Excessive use of credit (16 debtors)
  • Domestic discord or relationship breakdown (7 debtors)
  • Unemployment or loss of income (5 debtors).