
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, October 16, 1993                   TAG: 9310160053
SECTION: BUSINESS                    PAGE: A6   EDITION: METRO 
SOURCE: MAG POFF STAFF WRITER
DATELINE:                                 LENGTH: Medium

AREA'S BANKRUPTCY FILINGS STAY BELOW LAST YEAR'S LEVEL BUT DECLINE SLOWS

The 18-month decline in the number of Western Virginia bankruptcy filings slowed in the third quarter. And the current trend suggests 1993 will be the third-largest in the federal court's history.

"Where filings showed a decrease of 20 percent in the Western District of Virginia in the [second] quarter, that decline has slowed to just over 13 percent," said John W. L. Craig II, the court's clerk.

Business filings have continued to grow despite the overall decline in the number of petitions seeking protection from creditors.

Craig said the number of business petitions filed in the court's Roanoke division is up 27 percent over the same period a year ago.

Petitions in the Lynchburg division are up 12.7 percent and in Harrisonburg are up 7.3 percent.

Overall, for the Roanoke division, Craig said, the decline so far this year was 10.5 percent at the end of the third quarter, compared with a 19 percent decline at the second quarter.

The same thing happened in Lynchburg, which reported a 19.7 percent decrease by midyear. Lynchburg has moderated to a 15.4 percent drop for the year.

Craig said the trend is less pronounced in the Harrisonburg division.

In his quarterly report, released Friday, Craig predicted that 1993 will see the third-highest year ever for filings in the U.S. Bankruptcy Court for the Western District of Virginia, which is based in Roanoke.

For the first nine months of the year, the court's three divisions - in Roanoke, Lynchburg and Harrisonburg - have received 4,293 cases, compared with 4,890 for the same period last year.

The court noted a slight increase in the number of businesses filing for reorganization.

Craig said petitions for wage-earner plans have risen from 11.5 percent of the bankruptcy cases a few years ago to almost 14.5 percent.

When he issued his second-quarter report in July, Craig predicted the decline in filings might continue through the end of this year before turning up again.

He said a new wave of bankruptcy filings generally follows the holiday season, when both businesses and individuals burdened with year-end debt conclude there is little hope of getting out of debt and petition the court for relief.

The decline in bankruptcies followed five years of steady gains in the number of filings between 1986 and 1991. The number of petitions fell by 7 percent in 1992.

by CNB