Business failures in France continued to approach their pre-Covid level in February, according to figures published Thursday by the Banque de France.
The central bank thus recorded 57,798 defaults between March 2023 and February 2024, a total close to the average trend level of the indicator over the period 2010-2019 (59,342), before the Covid-19 pandemic, it details in a press release.
During the pandemic, public aid – State-guaranteed loans (PGE), partial unemployment, postponement of tax deadlines, etc. – had kept a number of businesses afloat, causing the number of insolvencies to drop.
In January, the Banque de France had recorded 57,034 business insolvencies over the previous twelve months, a total up 32.6% compared to January 2023.
In February 2024, the increase in the number of insolvencies slowed slightly, increasing by 30.6% year-on-year.
The recovery in insolvencies observed since the low point of December 2021 concerns all sectors of the economy (…) and all sizes of companies, explains the Banque de France.
The construction sector, penalized by the rise in interest rates operated by central banks to fight inflation, is experiencing a 36.9% increase in insolvencies over one year, with 12,257 insolvencies between March 2023 and February. 2024.
Insolvencies increased by 28.1% over one year in automobile trade and repair, to 12,511 in February 2024.
In percentage terms, the largest increase in insolvencies is observed in the real estate activities sector (+41.4% over one year), which recorded 2,045 over twelve months in February.
By company size, insolvencies increased by 30.6% over one year for SMEs (up to 249 employees), and by 78.1% for intermediate-sized companies and large companies.
This progression seems to have a double effect, analyzes the Banque de France: the current slowdown of the economy, even if growth remains positive and the catching up of delay in failures observed during the Covid period, with nearly 50,000 fewer failures over the 2020-2023 period.
Public services and those of the Banque de France are mobilized to support companies in difficulty. However, Credit Mediation has not recorded an increase in the number of referrals, trying to reassure the central bank.