Personal bankruptcies soar in Canada

Tue May 12, 2009 3:41pm EDT
 
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VANCOUVER, British Columbia (Reuters) - Personal bankruptcy filings in Canada rose by more than one-third in the first quarter of this year, showing the pressure the recession is putting on individuals.

Figures released on Tuesday by the Office of the Superintendent of Bankruptcy Canada showed that 35,543 people filed for bankruptcy in the first three months of 2009, a jump of 35.9 percent from the same period a year earlier.

That figure also includes those who made proposals to creditors to settle debts under conditions other than existing terms.

However, bankruptcy filings by businesses actually fell by 11.2 percent in the first quarter to 1,796, compared with the January-March period in 2008.

Canada's economy shrank at its fastest pace on record in the first quarter, contracting by an annualized 7.3 percent, the Bank of Canada estimated.

Finance Minister Jim Flaherty said earlier on Tuesday he expects more job losses in coming months, despite an unexpected employment gain in April.

Total bankruptcies in Canada last year rose 12.3 percent over 2007, an increase driven by personal insolvencies as business bankruptcies dropped 2 percent year over year.

(Reporting by Nicole Mordant; editing by Rob Wilson)

 
<p>A man holds Canadian currency in this posed photograph in Toronto, October 22, 2008. REUTERS/Mark Blinch</p>