Personal bankruptcies are declining throughout Canada, according to the Office of the Superintendent of Bankruptcy (OSB). And no where are they falling faster than in Alberta. Nationally, consumer insolvencies fell by 8.8 per cent in April compared to a year earlier. In Alberta, they fell by 20.9 per cent, the fastest rate in Canada (see chart). The OSB reported that 367 Alberta households declared personal bankruptcy in April, a drop of nearly 97 households from a year earlier. Interestingly, bankruptcies increased on a monthly basis across all provinces except Ontario and Saskatchewan. Alberta posted a small increase of half a percentage point from March to April. New Brunswick had the highest monthly increase at 48.5 per cent. Alberta’s low unemployment rate, strong labour market and increasing weekly earnings are helping stave off bankruptcies. With more money their pockets, Albertans are having an easier time managing debt. Low interest rates are also keeping debt servicing costs low. The Bank of Canada has used low interest rates since September 2010 as a means of targeting disinflation and contractions in the economy. One of the unintended consequences, however, is that many Canadians have taken on high levels of debt. Economists expect a rate increase in mid-to late-2015—at which point some households may start to struggle with debt and insolvency once again.  As posted by the ATB on July 2, 2014.

By Nick Ford – Economist – ATB

Now, the other 1/2 of the story………. Personal Bankruptcies may be on the decline but more than 50% of people in financial trouble now file a Proposal or re-payment plan under the legislation instead of a bankruptcy.  The economist’s don’t tell you this.  It used to be that out of every 100 people needing the help of a Bankruptcy Trustee, 90 would file for bankruptcy. Over the years that percentage has changed so now, only about 50% are filing for bankruptcy and the rest are filing proposals. So yes, bankruptcies may be down, but the number of people needing help managing their debt is not necessarily down as much as they lead you to believe!