MNI BRIEF: German Insolvencies Sen Rising This Year - IWH
Insolvencies in Germany ticked to their highest level seen through 2022 in December, the latest Leibniz Institute for Economic Research Halle (IWH) figures show [in German], but were still below the average rate recorded between 2015 and 2019. The number of partnerships and corporations going bust last month was 879, up from 808 the previous month and 23% higher than the same period in 2021, with the largest 10% of insolvencies affecting some 9,000 jobs.
"For the coming months, we expect similarly high insolvency figures as in December 2022. In the spring, the numbers could increase further due to seasonal factors," IWH’s Stefan Müller said. "Despite the expected increase, the insolvency figures will probably not rise above the long-term average until spring 2023."
An increased level of corporate insolvencies as interest rates rise will be a concern for the European Central Bank, but, for now at least, they pose no immediate financial stability fears with banks far better capitalized than in previous downturns.