It was the most critical phase in decades, when after the bankruptcy of Lehman Brothers, the world seemed to come to a standstill for months. Back then, international trade almost came to a complete halt for several months. The number of insolvencies in Germany also skyrocketed and banks were saved from collapse with financial injections in the billions.
According to a (not yet published) study by the Leibniz Institute for Economic Research in Halle (IWH), to which the Handelsblatt is referring, the number of insolvencies in Germany has reached the same value as in March of that year – although the new tariffs imposed by US President Donald Trump have not yet had any impact. The official preliminary numbers of the Federal Statistical Office for March will be published on Friday.
In March, a total of 1,459 companies filed for insolvency at the local courts, which is 12% more than the previous year. The insolvency applications are distributed relatively evenly across the federal states; in the most populous federal state of North Rhine-Westphalia, there were 339 insolvencies, in the second-largest, Bavaria, there were 204 and in the third, Baden-Württemberg, there were 147. All major industries were affected, but the industry was hit the hardest, with 43% more insolvencies than in March 2024.
The economic institute attributes this increase to the lingering effects of the Corona measures, which had suspended the obligation to file for insolvency. However, these measures ended in 2022.
“Extremely low interest rates have prevented insolvencies for many years and during the pandemic, insolvencies of already weakened companies were postponed due to support measures” explained Steffen Müller, the head of insolvency research at the IWH.
Additionally, there is the overall economic situation. An improvement through the (debt-financed) planned infrastructure investments is not expected until 2026.
What the report in the Handelsblatt does not suggest: The goal of an insolvency procedure is usually to rescue companies through restructuring and new investors. However, in particular in the export-oriented sectors of the German industry, the future development is currently unpredictable. This means not only the number of insolvency applications is at a record high, but also the prospects of rescuing companies through investors are extremely unfavorable, so the proportion of insolvencies that end with the closure of the company is likely to rise significantly in the coming months.