US Corporations, encouraged by a decade of historically low interest rates, had raised record levels of debt. In December of 2019, US corporate debt levels had ballooned to $10 trillion, a record 47 percent of the overall economy.
With leverage comes risk and a greater the likelihood that previously healthy businesses will begin to breach their debt covenants.
It a typical year, thousands of businesses in the United States file for bankruptcy. We expect to see a further increase in bankruptcies globally. In some cases, these bankruptcies will result in the closure and complete liquidation of the business. In others, bankruptcy will provide a restart opportunity to escape burdensome leases, agreements and revitalize a viable business.
Companies facing financial distress and turmoil are operating under enormous pressure, facing complex and confidential matters, and typically face time sensitive deadlines. Ocean Tomo presents a White Paper Series on Corporate Restructuring & Bankruptcy. You can download first two papers in the series focused on Corporate Borrowing Business Loan Foreclosure and Fresh Start Accounting below.