In a notable economic trend, the Czech Republic experienced a significant downturn in business bankruptcies last year, reaching a record low not seen in a decade. According to data analysis conducted by the CRIF – Czech Credit Bureau, the number of declared bankruptcies stood at 4,943, marking a four percent year-on-year decrease.

Throughout the year, a total of 5,343 insolvency petitions were filed, representing a marginal half-percent reduction compared to the previous year. The month of December saw 286 business bankruptcies, marking the lowest figure since December 2012. Additionally, there were 352 bankruptcy petitions filed during the same period, representing the lowest count for the entire year.

CRIF analyst Věra Kameníčková commented on the December statistics, noting that while it is customary to observe fewer bankruptcies in that month, December 2023 brought the lowest numbers in the past 11 years. The year 2023 was characterized by a notable surge in the cancellation of trade licenses, primarily driven by individuals no longer actively using them, often due to the mandatory requirement of having a data box. Kameníčková added that the substantial increase in extinct businesses last year was mainly due to administrative reasons, as evidenced by the low number of bankruptcies, a significant predominance of bank deposits over loans, and exemplary payment morality in loan repayments.

Analyzing regional dynamics, the Moravian-Silesian region topped the list with the highest number of business bankruptcies at 645, followed by Prague with 594 and the Ústí region with 534 bankruptcies. Most regions experienced a decrease in bankruptcy numbers, with the Central Bohemian region leading with a notable 13 percent year-on-year reduction, followed closely by the Pardubice and Hradec Králové regions, each recording a 12 percent decrease. This data reflects a positive economic shift, indicating improved financial resilience and stability within the Czech business landscape.

Article by Prague Forum