Judicial recovery requests in Brazil hit a record high in Septemberwith 244 applications, up 178% from Augustand 66% from a year ago, according to figures released by credit research firm SerasaExperian.
In the year-to-date period, judicial recovery came to 1,479, 62% more thanin the same period of 2015. The bulk of applications have come from the micro- andsmall-sized business segment, accounting for 176 of applications in September and917 applications in the year-to-date period.
"The record high of judicial recovery requests achievedin September reveals the serious financial situation of Brazilian companies, especiallymicro and small [enterprises]," the credit research firm said. "Facinga prolonged recession that deteriorates cash flow, combined with adverse creditconditions … [companies] end up having to use judicial recovery instruments as asurvival mechanism."
Meanwhile, bankruptcy requests between January and Septemberincreased 6% year over year to 1,405 filings, whereas the number of bankruptciesenacted in the period totaled 546, 17.1% higher than a year earlier.