Doubling bankruptcies, but corona not the only culprit


In the second quarter of 2019, 77 large companies went bankrupt, exactly one year later there were 150, according to calculations by Euler Hermes. In total, this involves a turnover of 106.9 billion, says Risk Director Johan Geeroms.

The increase is greatest in Western Europe. “In the Netherlands, you don’t see many companies failing. We have NOW 1 and NOW 2. The Dutch government can afford that too. We were in good budget for it. The national debt was 60 to 70 percent of the gross national product. . ”


This is different in other European countries. “In Belgium, the national debt is around 110 percent, in Italy at 130 percent. The government cannot help adequately there and you see companies falling. In the Netherlands, too, we will have such a setback in the last quarter and the first quarter of next year. when the support stops, “says Geeroms.

He calls it an ‘expanding process of zombification’. “You can’t see it from the outside, but financially companies are on the drip. If governments start to reduce support measures, central banks limit easing and unemployment rises sharply, I expect a radical shake out of weak brothers.”


Most bankruptcies in large companies now occurred in the retail sector (52 companies). Euler Hermes expects the construction, automotive, entertainment and hospitality sectors to follow.

Many companies that fell pointed the finger at the corona virus. Customers stay away, sometimes a case cannot be opened due to a lockdown.

However, according to Geeroms, it is far too easy to blame only the corona virus. “Underlying there is often more going on. This can be a wide range of bottlenecks: from debt and overcapacity to digital disruption and cyclical exposure. Corona is exacerbating the problems. On top of that there is also Brexit and increasing protectionism. Enough reasons for this. entrepreneurs to be cautious. ”


One of the most striking bankruptcies was that of fashion retail company FNG, mother of fashion chains such as Miss Etam, Claudia Sträter, Brantano and Steps.

According to crisis manager Paul Lambrechts, who was appointed in July to save the company from collapse, the company faced several problems in addition to corona. According to him, takeovers were not properly integrated and the company made acquisitions that it could not pay with its own proceeds, but only with debts.


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