By James B. Kelleher
CHICAGO (Reuters) - Recent bankruptcy filings by small U.S. businesses show a trend that could complicate lenders' efforts to identify at-risk borrowers, a new study reveals.
PayNet Inc, which provides analytic tools to the commercial credit industry, looked at 750 small business bankruptcy filers and found 50 percent were current with one or more of their lenders when they threw in the towel and sought protection from their creditors.
"Approximately half the lenders never saw it coming," PayNet President Bill Phelan said. "They were blindsided."
PayNet will officially release the study on Monday at the annual convention of the Equipment Leasing and Finance Association in San Diego.
The 750 companies PayNet studied collectively owed $58 million in loans, leases and lines of credit -- a tiny fraction of the 100,000 small businesses that PayNet said have filed for bankruptcy over the past year with an estimated $10 billion in obligations outstanding.
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Posted by: Amy Nightingale
Wow that is a lot of money owed! It seems like smaller businesses are being hit worse now but hopefully it will all turn around soon. -Kelsey Hoffman
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