• 6,700 companies entered insolvency procedures in 2022, of which only 67 are impact companies, with assets exceeding EUR 1 million.
• Over 13,000 companies, totalling a turnover of over EUR 93.5 billion and over 710k employees are on the edge of restructuring or in imminent insolvency
• Trade, constructions and manufacturing remain 2022's most affected fields. Companies in these fields represent over 60 % of the total number of companies that entered insolvency procedures in 2022.
• Bucharest, Bihor and Cluj are the regions with most insolvencies

Over 6,700 companies have entered insolvency procedures in 2022, with a 10 % increase from 2021 (6,144). Of these, 67 are impact companies, totalling over 5,500 employees, holding assets worth over RON 1.5 billion and debts to the state budget of over RON 170 million, as shown in the analysis by CITR, insolvency and restructuring market leader in Romania. The number of impact companies that have entered insolvency procedures remains 67, approximately 1 % of the total in imminent insolvency, a similar percentage as the one recorded in 2021.

“Despite the attempts from European regulations, to encourage quick and efficient restructuring mechanisms, we find inertia is maintained when it comes to companies in distress. Although in Romania we have two new structuring mechanisms, timely inserted into our legislation, we note that only 1 % of the impact companies that could benefit from a restructuration have gone under the protection of insolvency law, most being procedures requested by creditors, not out of their own volition” said Paul Dieter Cîrlănaru, CITR CEO.

The study of impact companies, published by CITR at the end of 2022, shows that 43 % of the companies are postponing the decision to take recovery measures, for more than 3 years, resulting in a disproportionate increase of debt volumes to maintain activity. Nevertheless, delay diminishes chances of recovery. Last year, there was an increase in the number of restructuration procedures in the pre-insolvency area or outside of insolvency, by applying the tax facilities offered to companies. This market tendency shows that entrepreneurs have searched for punctual measures to reduce debts.

“Current figures are a result of tax measures applied over the last period, as a reaction to economic difficulties, and is manifested through an increase in the level of global debt on all segments - public, private, and at household level. Only a reversal of this trend would lead to taking measures to actively treat the difficulties faced by impact companies. And the effect will be visible in the health of companies and of our economy”, concluded Paul-Dieter Cîrlănaru.

After two years of decrease in insolvencies on a global scale, the latest figures[1] confirm that they are once again escalating in worldwide economies, considering the gradual end of temporary relief measures by states, which, most of the time, have only delayed the moment of insolvency. The later are salvation and restructuring solutions accessed, the lower the chances of recovery.

Historically speaking, the significant waves of insolvencies have brought about a gap of several years from the difficult moments in economy. For instance, after the 2008 crisis, the peak of the insolvency period was recorded in 2012-2015. What differs now is that we have new restructuring mechanisms, which can streamline or support companies in distress to bounce back more easily. The business environment can benefit from clear and efficient procedures, namely the restructuration agreement and the arrangement with creditors, where they are free to negotiate with creditors and suspend enforcements, and, at the same time, the companies’ creditors can receive a higher degree of debt recovery by calling upon these restructuring mechanisms from the very first signs of distress.

About CITR

CITR has been the insolvency and restructuration market leader in Romania ever since 2008. With an experience of over 22 years on the insolvency market and over 1100 projects managed over time, CITR is managing assets worth EUR 1 billion on a yearly basis, and is distributing over EUR 100 million to creditors each year, in its mission to save the value of Romanian companies with an impact.

CITR is a company of Impetum Group, the first Romanian group dedicated to maximizing business value in each stage in a company's life, with the aim of creating a positive impact on the economy.