Sweden breaks trend of rising bankruptcy figures

The number of Swedish companies filing for bankruptcy has dropped for the first time since June 2008, new figures show, although many companies continue to struggle.

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According to the UC credit rating agency, 543 companies went bankrupt in October, a 7 percent drop compared to the same month last year.

“Even if the number of bankruptcies is relatively high, this month’s development shows that the effects of the financial crisis and the rapid worsening of economic conditions which started last autumn are abating, which in our case has temporarily led to a stabilization in the number of bankruptcies,” writes UC head of marketing Roland Sigbladh in a statement.

The drop in bankruptcies in October was spread evenly across different industries. From a regional perspective, Stockholm and Skåne were the counties which contributed most to the reduction. In Västra Götaland, however, bankruptcies continue to rise.

“The bankruptcy figures for Stockholm in October were low thanks to the region’s many service and trading companies, while Västra Götaland was hit primarily by an increase in construction bankruptcies,” said Sigbladh.

Despite the positive signs taken from October’s figures, the accumulated number of bankruptcies since the start of 2009 is still 33 percent higher than corresponding figures for 2008, according to UC.

In addition, many Swedish companies continue to face economic challenges due to weak demand. New orders remain weaker than normal, at the same time as many companies are being forced to cut prices.

“Demand is the biggest problem. And developments in the export sector have hit many suppliers hard. Many companies are fighting for survival, said Sigbladh.