Bankruptcies jump by 31%

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TORSTAR NEWS SERVICE

July 08, 2009 5:00 a.m.

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Bankruptcies in Canada continued to soar in May versus year-earlier levels as consumers succumbed to debt loads and job losses, but the tally improved modestly from April.

Results released yesterday by the Office of the Superintendent of Bankruptcy Canada showed a total of 10,364 bankruptcies registered in May, up 31 per cent from May of last year. Last month’s total fell nearly 10 per cent below April’s 11,465 bankruptcies.

Industry experts were doubtful that May marked a turning point in a string of soaring bankruptcies in recent months.

“I’m not confident that it’s the light at the end of the tunnel,” said Andy Fisher, a bankruptcy trustee with A. Farber & Partners, which has locations around the GTA and Ontario. “June was probably the busiest month we’ve ever had,” catering to debt-swamped Canadians being chased by creditors, he said.

Amid widespread job losses and reduced incomes “struggling people see credit as a way to get by,” he said. “Attitudes have changed. It’s not a stigma to have credit.”

But many who have embraced credit clearly can’t keep up. The May figures include 9,900 consumer bankruptcies, up about 34 per cent from a year earlier.

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