RECORD NUMBER OF BANKRUPTCIES FILED

December 4, 2001

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The number of new bankruptcies filed during fiscal year 2001 rose to a historic high during the 12-month period ending Sept. 30. Bankruptcy cases for FY 2001 totaled 1,437,354, which is a 14 percent increase from the
1,262,102 cases filed in FY 2000, according to data released today by the Administrative Office of the U.S. Courts.

The total number of new bankruptcies filed in the third quarter of 2001 (July 1 to Sept. 30) was 359,518, a 16.5 percent increase over the same period a year ago. This is the second highest third quarter ever and is surpassed only by the third quarter of 1998 when 361,205 new cases were filed. Through the first nine months of this year, filings are up 19.5 percent from the same period a year ago and up 3.5 percent from the same period in 1998.

Filings are now on their way to surpass the
recording-breaking year of 1998, when 1,442,549 new cases were filed.

In fiscal year 2001, the largest number of filings continues to be under chapter 7. Total chapter 7 filings were 1,014,137, a 16.5 percent increase from 870,805 in 2000. Chapter 13 filings, the next largest category, increased by 8.2 percent from 380,880 for the same period in 2000 to 412,272. Chapter 11 filings rose 7 percent from 9,835 to 10,519 and chapter 12 filings fell 31.2 percent from 551 to 379. Overall, chapter 12 filings
fell during this period. Chapter 12 expired on Oct. 1, 2001.

“Today’s filing statistics confirm that we will set a new record for bankruptcies in 2001,” said Samuel J. Gerdano, Executive Director of the American Bankruptcy Institute. “Hangover consumer debt from the
free-spending ’90s and a weakened economy today mean more families will face the need to file for protection well into next year,” he added.