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MONITOR OF
BANKRUPTCIES,
INSOLVENCY
PROCEEDINGS
AND BUSINESS
CLOSURES
FEBRUARY 2017
#30
• (2
)
• 75
,5%
a+2b
• 12
,5%
• 1.4
1421
3562
37
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
2
BANKRUPTCIES FELL FASTER
IN 2016, BUT VOLUNTARY
LIQUIDATIONS WENT BACK UP
SUMMARY
In 2016, both bankruptcies and other insolvency proceedings (especially voluntary
arrangements with creditors) declined even faster than they had in 2015. However,
In 2016, the number
of bankruptcies dropped
for the second consecutive year,
but the voluntary liquidation
figures are negative signals
more business owners decided of their own accord to wind up solvent businesses. So,
fewer companies went into default, but there are renewed signs that companies have less
optimistic expectations. This is, in brief, the picture that emerges from data on Italian
business closures in 2016.
According to Cerved’s records, about 13,500 Italian businesses went bankrupt in 2016,
which is 8.5% fewer than the 14,700 recorded in 2015. This was a further improvement on
the 6.1% decrease seen in 2015 compared to the record high reached in 2014. Bankruptcy
numbers decreased in all broad sectors of the economy and throughout the country,
with the exception of the island regions, where bankruptcy numbers went back up, most
substantially in Sardinia (by 26%).
Another 1,640 businesses began non-bankruptcy insolvency proceedings in 2016, 35%
fewer than in 2015. This downward trend, which began in 2013, has been driven by
a collapse in voluntary arrangements with creditors. The number of applications for
voluntary arrangements fell from about 1,400 in 2015 to just 817 last year (a 42% decrease),
far below the 2013 peak of 2,200. The number of other insolvency proceedings also fell
sharply in 2016, by 26% year-on-year.
Business closures, broken
down by type of procedure
number and year-on-year
% change from 2015 to 2016
18,000
16,000
100,000
9.2%
80,000
14,000
12,000
-8.5%
8,000
Other procedures
6,000
Voluntary liquidations (right column)
4,000
50,000
40,000
30,000
-35.1%
2,000
20,000
10,000
0
0
Source: Cerved
70,000
60,000
10,000
Bankruptcies
90,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
3
On the other hand, there was an upturn in voluntary liquidations of solvent businesses
last year. Based on actual figures and estimates, about 85,000 solvent companies shut their
doors, 9.2% more than in 2015. Even if we adjust for the effects of a newly introduced
tax break that encouraged liquidations of real estate companies, the number of voluntary
liquidations still rose by 3.8%, with an inversion in the trend seen in all sectors of the
economy and in all geographical areas except for the South. This inversion could be a sign
that entrepreneurs’ profitability expectations have worsened, and such an interpretation is
corroborated by ISTAT’s business confidence indicator, which dropped by five points from
2015 to 2016.
19.4%
Business closures by
geographical area
15.1%
7.6%
percent changes from 2015 to 2016
-2.9%
-5.2%
Bankruptcies
-6.4%
-10.0%
-13.1%
Other procedures
Voluntary liquidations
Source: Cerved
-26.2%
-37.5%
-38.2%
North-East
North-West
-36.1%
Centre
South & Islands
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February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
4
BANKRUPTCIES
Over the course of 2016, the downward trend in bankruptcies that began the year before
gained steam. Bankruptcy numbers went down in all sectors of the economy and in all
parts of the country except the two island regions.
The decline in bankruptcies grew even faster in the last quarter of 2016: between October
and December, about 3,400 businesses began bankruptcy proceedings, 16.4% fewer than a
year before. This is the biggest quarterly decrease recorded in about eight years, keeping up
a positive trend that began in 2015.
Bankruptcy trend
5,000
quarterly data
4,000
3,000
Raw data
Adjusted for seasonality
and working days
2,000
1,000
0
Source: Cerved
1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Overall in 2016, 13,500 Italian businesses went bankrupt, an 8.5% decrease from the
14,700 seen in 2015 (when bankruptcies fell by 6.1% from the 15,700 peak reached in
2014). The 2016 figure is nevertheless well above the level seen in 2008 (about 7,500), the
last year before the effects of the economic crisis were felt.
Bankrupcy trend
50%
year-on-year percent changes
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
Source: Cerved
1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
5
The 2016 bankruptcy decline was rather uniform across all legal forms of business, with
only a slightly greater decrease among corporations (8.5%) than among partnerships (8.2%).
For the second consecutive year, bankruptcies went down in all macro-sectors, though more
substantially in construction (by 11.1% year-on-year to 2,900) than in services (-8.7% to
7,100) or manufacturing (-5.8% to 2,100). Over a broader timeframe, the industrial sector
is much closer to its pre-crisis level (25% above) than either construction (81% above) or
services (100% above).
Bankrupcies by legal status
3,500
14,000
number and percent change
from 2015 to 2016
3,000
12,000
2,500
2,000
Other forms
1,500
Partnerships
Corporations (right column)
-8.5%
-6.2%
-8.2%
500
2,000
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
9,000
4,000
3,500
-8.7%
2,000
Industrial
1,500
Service (right column)
1,000
-11.1%
6,000
5,000
-5.8%
4,000
3,000
2,000
500
1,000
0
0
Source: Cerved
8,000
7,000
3,000
2,500
Construction
6,000
4,000
0
number and percent change
from 2015 to 2016
8,000
1,000
Source: Cerved
Bankruptices
by macro-sector
10,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
6
Within the tertiary sector, major improvements were seen in media and entertainment
(-20.6%), logistics (-15.3%) and retail/distribution (-12.7%), whereas bankruptcy numbers
increased in non-financial services (+1.1%). Within the industrial sector, bankruptcies went
up in metalworking (by 3.1%) and in fashion & apparel (by 0.8%), but are at rather low
levels from a longer-term perspective in those two sectors; meanwhile, substantial decreases
were recorded in high-tech industry (-21%), the automotive sector (-15.4%), intermediate
goods (-11.3%) and machinery (-10.2%).
In 2016, the number of bankruptcies also dropped in all broad geographical areas of Italy,
with greater decreases coming in the northern regions.
Unlike in the rest of the country, in the North-East bankruptcies had continued to increase
in 2015 (by 2.9% from 2014), reaching a record-high of nearly 3,000. In 2016, though,
there was a decisive 13.1% drop to 2,600 bankruptcies in the North-East. This decrease was
common to all north-eastern regions, and was in double-digit figures in Friuli (-20.8%), Veneto
(-14%) and Emilia Romagna (-11.2%), while less sizeable in Trentino Alto Adige (-6.7%).
Bankruptcies
in the service sector
number and percent change from
2015 to 2016, in the top 5 sectors
by number of 2016 bankruptcies
4,000
3,500
3,000
-12.7%
2,500
1.1%
2,000
Media & entertainment
Retail/ distribution
1,500
Non-financial services
1,000
Real estate
500
Logistics & transport
-1.8%
-15.3%
-20.6%
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Source: Cerved
Bankruptcies
in the industrial sector
900
number and percent change from
2015 to 2016, in the top 5 sectors
by number of 2016 bankruptcies
700
800
600
500
Fashion & apparel
Household goods
Motor vehicles
Metals
Machinery
400
300
200
0.8%
-10.2%
3.1%
-15.4%
-3.7%
100
0
Source: Cerved
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
Bankruptcies
by geographical area
number and percent change
from 2015 to 2016
6,000
5,500
5,000
4,500
-10.0%
-6.4%
-5.2%
4,000
3,500
3,000
North-East
North-West
Centre
South & Islands
7
-13.1 %
2,500
2,000
1,500
1,000
500
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Source: Cerved
In the North-West, bankruptcy numbers fell for the second consecutive year, by about 10%
to under 4,000. The most pronounced decreases were in Piedmont (-15%) and Liguria
(-12%), compared to an 8.3% drop in Lombardy.
In central Italy, about 3,400 businesses went bankrupt, 5.2% fewer than in 2015.
Improvements were seen in all central regions, most noticeably in Tuscany (-9.6%), with
slower decreases in Marche (-6.9%), Umbria (-5.9%) and Lazio (-1.5%).
In southern Italy and the island regions, about 3,500 bankruptcies were counted last year,
6.4% fewer than in 2015. All mainland southern regions witnessed decreases, but the two
island regions did not: bankruptcies rose by 3% in Sicily and by a much greater 26.2% in
Sardinia, bucking the downward trend observed the previous year. As for the rest of the
south, there were sharp decreases in Abruzzo (-36%), Molise (-14.3%), Calabria (-14%) and
Puglia (-12.1%).
Bankruptcies by region
in the North-East
number and percent change
from 2015 to 2016
1,600
1,400
1,200
-14.0%
1,000
-11.2%
800
Emilia Romagna
Friuli V. Giulia
Trentino A. A.
Veneto
600
400
200
-20.8%
-6.7%
0
Source: Cerved
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
Bankruptcies by region
in the North-West
number and percent change
from 2015 to 2016
8
1,400
1,200
4,000
3,500
-8.3%
3,000
1,000
800
2,500
-15.0%
2,000
Liguria
Piedmont
Valle d’Aosta
Lombardy (right column)
600
400
-11.9%
1,000
200
0
500
5.9%
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Source: Cerved
Bankruptcies by region
in Central Italy
2,500
number and percent change
from 2015 to 2016
2,000
1,500
Lazio
Marche
Tuscany
Umbria
1,500
1,000
500
-1.5%
-9.6%
-6.9%
-5.9%
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Source: Cerved
Bankruptcies by region
in the South & Islands
number and percent change
from 2015 to 2016
Abruzzo
Basilicata
Calabria
Campania
Molise
Puglia
Sardinia
Sicily
Source: Cerved
1,600
1,400
1,200
-4.1%
1,000
800
3.0%
600
-12.1%
400
26.2%
-14.0%
-35.9%
-6.5% -14.3%
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
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February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
OTHER INSOLVENCY
PROCEEDINGS
9
For the third year in a row, the number of non-bankruptcy insolvency proceedings dropped,
fuelled by a sharp reduction in the use of voluntary arrangements.
Between October and December 2016, 327 non-bankruptcy insolvency proceedings1
began; this is only about half as many as in the further quarter of 2015. The fourth quarter
figure brings the 2016 total to 1,640, which is 35.1% fewer than in 2015.
This decline has been heavily influenced by the trend in voluntary arrangement
applications. Use of this instrument skyrocketed from 2011 to 2013, due to both the
recession and legislative changes that encouraged financially troubled companies to seek
voluntary arrangements, especially the introduction of the ‘blank’ voluntary arrangement
application, whereby a company can prevent its creditors from obtaining repossession
orders while it drafts a restructuring plan.
Trend in non-bankruptcy
insolvency proceedings
1,000
quarterly data
800
Raw data
600
Adjusted for seasonality
and working days
400
Source: Cerved. N.B. Does not include
'blank' voluntary arrangements,
proceedings for business registry
cancellations, dissolutions by regulatory
authorities, or court-ordered proceedings.
200
Non-bankruptcy
insolvency proceedings,
by type of procedure
2,500
number and percent change
from 2015 to 2016
0
1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2,000
1,500
Voluntary arrangements*
Other procedures**
Source: Cerved. (*) Voluntary
arrangements that include restructuring
plans. (**) Does not include proceedings
for business registry cancellations,
dissolutions by regulatory authorities,
or court-ordered proceedings.
1,000
-42.3%
-25.9%
500
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
1. Our analysis includes proceedings for extraordinary administration, voluntary arrangements (i.e. composition
with creditors), business restructuring agreements under Art. 182 of the Bankruptcy Law, as well as receivership
proceedings and insolvency declarations. It does not include business registry.
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
10
Then in 2013, some amendments2 were made to this legislation, after which voluntary
arrangements rapidly fell out of favour. In 2016, just 817 applications were filed for
voluntary arrangements, 42% fewer than in 2015 and only one-fourth the number filed
in 2013. Applications for ‘blank’ voluntary arrangements fell from about 4,500 in 2013 to
1,600 in 2016.
After four years on the rise, the number of other insolvency proceedings also went down in
2016. According to the data, there were 823 of those last year, 26% fewer than in 2015.
Non-bankruptcy insolvency numbers decreased in all sectors of the economy, with 37%
drops in the industrial and construction sectors and a 32% drop in the service sector.
From a geographical perspective, the decline ranged from 35% to 38% in central and
northern Italy, while it was a more moderate 26% in the south and islands.
Non-bankruptcy
insolvency proceedings
by macro-sector
800
1,800
700
1,600
1,400
600
Other
Construction
Industrial
Service (right column)
Source: Cerved. N.B. Does not include
'blank' voluntary arrangements,
proceedings for business registry
cancellations, dissolutions by regulatory
authorities, or court-ordered proceedings.
Non-bankruptcy
insolvency proceedings
by geographical area
1,200
500
1,000
400
800
300
600
200
400
100
200
0
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
1,200
1,000
800
North-East
North-West
Centre
South & Islands
Source: Cerved. N.B. Does not include
'blank' voluntary arrangements, proceedings
for business registry cancellations,
dissolutions by regulatory authorities,
or court-ordered proceedings.
600
400
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2. Shortly after introducing ‘blank’ voluntary arrangements, the legislature began to fear that this option could
be used opportunistically, and thus in Law Decree no. 69/2013 granted courts the right to appoint a special
commissioner to monitor the conduct of the applicant debtor company.
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
VOLUNTARY
LIQUIDATIONS
11
It is estimated3 that in the fourth quarter of 2016, about 40,500 owners of solvent
companies decided of their own accord to close down the business; this is 10% more
than in the last quarter of 2015. This is the third consecutive quarter in which voluntary
liquidations have gone up, leading to an overall increase in 2016 of 9.2% year-on-year to
over 85,000.
A portion of this increase can be attributed to new tax regulations that made it
advantageous for some companies, particularly real estate companies, to liquidate4.
Trend in voluntary
liquidations
30,000
quarterly figures,
adjusted for seasonality
and the number of working days
26,000
Total
Corporations* (right column)
14,000
13,000
12,000
11,000
22,000
10,000
9,000
18,000
8,000
7,000
14,000
Source: Cerved estimates.
(*) Excludes companies that did not
10,000
submit any valid financial statements
1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q
in the three years prior to winding-up
6,000
5,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Annual voluntary
liquidations
100,000
number and year-on-year
percent changes
80,000
Total
Excluding real estate companies
90,000
9.2 %
3.8 %
70,000
60,000
50,000
40,000
30,000
20,000
10,000
Source: Cerved estimates
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
3. Due to delays in Chamber of Commerce database updates, liquidation figures are estimated for the most recent
quarter and then corrected and updated to show the actual number in the subsequent Monitor report. The actual
third quarter 2016 number of about 15,000 is higher than the estimate of 14,000 provided in the previous edition of
this Monitor.
4. The 2016 Stability Law (Italy’s annual budget and financial law) contains a measure introducing tax breaks on the
transfer of immovable property to the stakeholders of companies in liquidation, which has provided an incentive for
some companies – especially real estate companies – to liquidate.
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
12
Indeed, liquidations of real estate companies soared by 67%, from 6,600 in 2015 to 11,100
in 2016. If we exclude real estate companies from the statistics, voluntary liquidations
rose by a much more moderate 3.8% in 2016, but this marks an inversion in the trend
nonetheless. Therefore, this increase might be a reflection of less optimistic expectations
among entrepreneurs, an argument that is corroborated by ISTAT’s business confidence
indicator, which fell by five points from 2015 to 2016.
Voluntary liquidations rose year-on-year in 2016 among partnerships (+7%), ‘real’
corporations (+8.5% among companies that submitted at least one set of valid financial
statements in the last three years prior to winding up), as well as ‘dormant’ companies
(+26% among those that did not submit financial statements or reported zero revenue).
Business confidence
climate and voluntary
liquidations
figures adjusted for seasonality
and working days
Voluntary liquidations (adj.)
Business confidence (right column)
26,000
110
24,000
100
22,000
20,000
90
18,000
80
16,000
Source: Cerved illustration
14,000
70
of ISTAT data
Jan May Sep Jan May Sep Jan May Sep Jan May Sep Jan May Sep Jan May Sep Dec
2011
Annual voluntary liquidations,
by business status
number and year-on-year
percent changes
2014
2015
2016
Source: Cerved estimates.
(*) Excludes companies that did not
submit any valid financial statements
in the three years prior to winding-up
2012
2013
2014
2015
2016
45,000
40,000
35,000
8.5%
-8.7%
-6.8%
7.0%
30,000
25,000
20,000
15,000
10,000
9.6%
5,000
25.9%
0
Corportations*
Dormant companies
Partnerships
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
February 2017 / n° 30
MONITOR OF BANKRUPTCIES, INSOLVENCY PROCEEDINGS AND BUSINESS CLOSURES
Voluntary liquidations
by macro-sector
25,000
number and percent change
from 2015 to 2016
20,000
13
50,000
5.5%
40,000
-0.3%
15,000
Other
Construction
Industrial
Service*
Source: Cerved estimates
(*)excluding real estate companies
30,000
10,000
6.6%
20,000
5,000
2.8%
10,000
0
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Breaking down the figures by sector, we see that voluntary liquidations picked up across the
entire economy. Increases were more sizeable in construction (+6.6%) and services (+5.5%
excluding real estate companies) than in manufacturing (+2.8%). In all macro-sectors,
though, the number of voluntary liquidations was lower in 2016 than the 2013 peak.
From a geographical point of view, the increase was concentrated mainly towards the
northern end of the Boot, where voluntary liquidations rose by 7% to 11% (7.3% in the
North-West, 10.6% in the North-East). Increases were also seen in central Italy (+3.7%),
whereas a downward trend continued in the South (-4%).
Voluntary liquidations*
by geographical area
number and percent change
from 2015 to 2016
North-East
North-West
Centre
South & Islands
30,000
25,000
20,000
7.3%
-4.0%
3.7%
10.6%
15,000
10,000
5,000
Source: Cerved estimates
(*) Excluding real estate companies
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited
Interactive graphs are available at know.cerved.com
© 2017 – Cerved Group Spa – All rights reserved – Reproduction prohibited