Romanian insolvencies down by 35 percent to 4.414 cases in Q1, says Coface

Newsroom 13/06/2012 | 16:08

Around 4,400 Romanian companies filed for insolvency in the first quarter of this year, which is a 34.6 percent decrease on the similar period of 2011, with retail and constructions taking the brunt, reveals a report of Coface Romania, the credit insurer, based on data from the National Trade Registry Office (ONRC).

The Coface report says 4,414 companies were in different insolvency stages, which is a lower value year-on-year due to a positive basis effect. Insolvencies reduced by half in the vehicle and equipment industry, steel industry, healthcare and social assistance sector.

Retail and wholesale trade, followed by the construction sector, accounted for 54.9 percent of insolvencies in Q1, slightly decreasing from Q1 2011. However, the report says insolvencies in the constructions industry fell by 40 percent in Q1 to 645 cases.

“The insolvency contraction in the first quarter of this year against the similar period of last year is the most significant in the last 5 years, covering for the first time all the industry sectors,” said Iancu Guda, macroeconomic analyst at Coface. “We attribute this trend rather to structural factors such as the decrease of active legal persons in the last three years, a high basis effect from the previous year, and the filtering of less competitive firms during the recessions,” he added.

A sharp increase of insolvency filings was registered in Arad County, tripling in Mures County and doubling in Dambovita County. Decreases were registered in 6 counties, including Brasov, Iasi and Constanta.