​H1 2018 – Major Insolvencies

7/20/2018 - Presentation
ic_blogtagInsolvency and Payment RiskNorth AmericaWestern EuropeAgrifoodConstructionEnergyRetailInsolvencyOvercapacities

Major Insolvencies - Photo by joel herzog on Unsplash.jpg

  1. On a global level, H1 2018 monitoring points to a high frequency of major insolvencies when focusing on companies with a turnover exceeding EUR50m. Based on their cumulative turnover, it also points to a worsening severity which could have serious effects on providers along supply-chains. 
  2. All in all, H1 2018 posted a quasi-stable number of major failures (+3 cases vs H1 2017 to 169 insolvencies),while cumulative turnover reached EUR62.3bn after increasing +24% vs H1 2017.  On a rolling 12 months basis, the increasing trend remains on track, despite a softening, with +39 cases to 341 insolvencies and +EUR25.2bn to EUR125.8bn in cumulative turnover.   
  3. Asia (+11 insolvencies compared to H1-2017) and Western Europe (+8) are mostly responsible for the global level, while the US (-3) remains the main contributor to the top insolvencies, displaying the 2 biggest failures and 6 out of the 10 largest insolvencies. 
  4. Retail (28 insolvencies), Construction (24) and Agrifood (18) were the most affected sectors in terms of number of insolvencies. Yet, Textile (+7), Household Equipment (+6) and Energy (+6) posted the strongest rise in insolvencies, while Services (-16) saw a noticeable decline.
  5. ​In that context the hot spots were Retail, Agrifood and Services in Western Europe, Construction and Energy in Asia and Retail in North America. They reflect a wide range of challenges (indebtedness, input prices, overcapacity, digital disruption, cyclical exposure) and suggest more discrimination by risk managers.