Polsinelli Announces Release of 4th Quarter 2016 Polsinelli I TrBk Distress Indices
Economic indicators show an increase in business bankruptcy filings
New York City
(March 1, 2017) – Polsinelli, an Am Law 100 firm, announced today the release of the Polsinelli I TrBk Distress Indices
for the fourth quarter of 2016.
The Polsinelli I TrBk Distress Indices are the backbone of a research report that use Chapter 11 bankruptcy filing data as a proxy for measuring financial distress in the overall U.S. economy, as well as breakdowns of the real estate sector and the health care services sector.
“Uncertain. Turbulent. Tenuous. These adjectives fail to capture the level of economic certainty facing America today,” said Jeremy Johnson, a bankruptcy and restructuring attorney at Polsinelli and one of the authors of the report. “We have a new presidential administration and the Federal Reserve increased rates modestly for only the second time in the last decade last quarter. Nobody seems exactly sure what is happening with the U.S. economy, but the data tells us a clear story – business bankruptcy filings are increasing and management, and professionals, should be prepared.”
The indices are likely to be contrarian indicators of economic performance, so that a high index value reflects increasing financial distress in the economy. The indices track the increase or decrease in comparative Chapter 11 filings for prior quarters and years, based on a rolling four-quarter average.
Throughout 2016, the Polsinelli I TrBk Distress Indices research showed the gradual acceleration of bankruptcy filings in all sectors. The first two quarters of 2016 were the first and second times that each of the indices increased across the board. The fourth quarter of 2016 showed no change from this trajectory with the rate of bankruptcy filings continuing to advance.
Both the general Chapter 11 and Real Estate Indices are trending upwards, with small increases from the third quarter of 2016 and material increases year over year. The Healthcare Services Distress Index receded slightly, but this pullback comes after three straight quarters of record highs.
To access the full report, and all past analysis, visit https://www.distressindex.com.