The decrease was seen in every Canadian region during the third quarter
Canada’s consumer insolvency levels have fallen by nearly 40% compared to pre-pandemic levels, although household debt remains “excessively high,” according to the Canadian Association of Insolvency and Restructuring Professionals.
During Q3 alone, insolvencies decreased by 7.8% on a quarterly basis. This marked the most significant quarterly dip since the onset of the pandemic, CAIRP said. The Q3 volume amounted to roughly 21,100 Canadians, or around 230 each day, filing for insolvency.
Every Canadian region saw a quarterly decrease in consumer filings during the period, CAIRP added. The largest proportional declines were registered across Atlantic Canada in Newfoundland and Labrador (-28.3%), Prince Edward Island (-17.9%), New Brunswick (-17.6%), and Nova Scotia (-12%).
Overall consumer insolvencies for the 12-month period ending Sept. 30 were 15.8% lower compared to the same period last year.
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However, the knock-on effects of tapering government supports should not be underestimated, said André Bolduc, licensed insolvency trustee and vice chair of CAIRP.
“A jump in personal insolvencies has so far been averted, but Canadians have excessively high household debt, and the financial strain of the pandemic will be the match in the powder barrel for many families,” Bolduc said.
