Insolvencies in Switzerland stabilize after record year in 2022
After an absolute record last year of +33 % insolvencies in Switzerland, these will only increase by +4 % in 2023. Across Europe, the insolvency rate is expected to reach +24 %, according to forecasts by Allianz Trade, the world's leading credit insurer.
Following the end of federal support measures, the number of insolvencies in Switzerland rose to a record 6796 cases last year. The previous record was 6225 cases in 2018. This meant that Switzerland, along with the UK and Spain, was already well above pre-pandemic levels (+13 %). Fortunately, they have now recovered and should not exceed +4 % in 2023 - despite the continuing challenging economic and financial environment due to tighter bank credit conditions, increased energy prices and high wages.
Development in Switzerland and Europe not parallel
In Europe, the insolvency dynamic is more pronounced than the global average (+21 %), with an expected increase in bankruptcies of around 24 %. This is mainly due to strong increases in insolvencies in the Netherlands (+52 %), France (+41 %), Ireland (+30 %) and Italy (+25 %). Many European countries already significantly exceed pre-crisis levels in 2023, led by Spain (+75 % in 2023 vs. 2019) and the UK (+29 % vs. 2019). Most European countries will suffer larger corporate insolvencies this year than Switzerland with its +4 %. It should be noted here that last year, when Switzerland had to cope with a record +33 %, Europe only saw an increase of +7 % on average. In Switzerland, the "normalization" of corporate insolvencies after the pandemic has already taken place.
A look at insolvencies worldwide
After a slight increase in 2022 (+2 %), global insolvencies will rise by +21 % in the current year and by +4 % in 2024 (Europe -1 %, Switzerland -4 %). This global trend masks significant local differences. Allianz Trade forecasts that in half of the countries surveyed, insolvencies will exceed pre-pandemic levels in 2023, and in three out of five countries in 2024. In short, in most countries the number of insolvencies will exceed 2019 levels by the end of 2024. "In Europe, we expect the number of insolvencies to reach 59,000 (+41 %) in France, 28,500 (+16 %) in the UK, 17,800 (+22 %) in Germany and 8900 (+24 %) in Italy by 2023. In the US, we expect a rise of +49 % by 2023, driven by tighter credit conditions and the expected sharp economic slowdown, which would imply a return to more than 20,000 insolvencies per year. In Asia, China is likely to see a moderate increase (+4 %) as the reopening has not removed all risks, especially in the real estate sector," explains Maxime Lemerle, senior insolvency research analyst at Allianz Trade. These figures are not a reason to panic, according to Allianz Trade analysts, but they are a reason to be cautious and to manage debtors and liquidity even more carefully.
Source: Alliance Trade
