2023 was a difficult year for the European economy. The economic zone had to contend with weak growth. Global economic stimulus largely failed to materialize, while rising geopolitical tensions added to uncertainty. The Central Bank (ECB) curbed inflation by raising interest rates as well as consumption and investment.

Thus, in 2023, the number of insolvency cases continued to increase in Western Europe. Compared to the previous year, the number of company insolvency cases increased by approximately 21%, reaching slightly less than 170,000 cases. The situation has now leveled off and is now above pre-pandemic levels. In 2023, the number of insolvency cases in Western Europe exceeded the indicators from 2017 to 2019. This was mainly due to the poor economic situation - exacerbated by previous crises such as rising energy costs, inflation and Covid-19. The economic situation of many companies worsened, which increased the pressure to start the insolvency process.

Insolvency rates rose in most Western European countries - particularly sharply in the Netherlands (by 54.9%) and France (by 35.6%). They also increased by more than 20 percent in Sweden, Ireland, Finland, Norway and Germany. In contrast, Denmark, Luxembourg, Spain and Portugal saw a decrease. Western Europe was dominated by France (33.0%) and the United Kingdom (15.6%). The share of insolvency transactions of the Scandinavian countries decreased slightly, while the share of Germany remained stable. The percentage increase in insolvency rates is measured in double digits in all major sectors of the economy. A particularly rapid increase was observed in the trade sector (24.8%) and a more moderate increase in the service sector (16.2%). In manufacturing, the trend of insolvencies accelerated and the increase was higher than the previous year. However, the numbers in manufacturing are still slightly below 2019 figures. Regarding the financial position of companies: After a slight improvement in the profit situation in 2021, the positive trend seems to have ended again. More and more companies recorded losses or very low profit margins in 2022 (47.4%; 46.2% the previous year). At the same time, 18.8% of companies had a very high profit margin exceeding 25%. In contrast, the equity indicators of Western European companies increased in 2022. The share of companies with an equity ratio of over 50% increased to 48.3%, while the share of companies with a very low equity ratio of less than 10% decreased to 21.4%. Compared to 2013, there are now significantly fewer companies with low equity capital. This is also related to the increase in the cost of borrowed capital.

In Western Europe, the average balance of turnover days has decreased. It fell from 50.5 days the previous year to 48.8 days in 2022, a 10-year low. For suppliers and service providers, this means that the time it takes to pay for services or goods is reduced.

Insolvency rates also rose in Eastern Europe, with Hungary largely responsible for the roughly 8% increase. In six of the twelve countries analyzed, the number of cases decreased. The biggest decrease was in Croatia (minus 22.3%) and Latvia (minus 21.2%). In addition to Hungary, the increase was also registered in Estonia, Slovakia, Serbia, Slovakia and the Czech Republic. In total, nearly 65,000 corporate insolvencies were registered in Eastern Europe - compared to just over 60,000 the previous year. 30 Corporate insolvency in Europe - 2023 In the United States in 2023, a significant increase in the number of corporate insolvency cases (plus 19.3%) was recorded - 25,627 cases (previous year - 21,479 cases).