Rising interest rates appear to be taking a toll on Canadians’ finances as the total number of insolvencies filed under the Bankruptcy and Insolvency Act increased by 5.2 per cent in November from the prior year.
The Office of the Superintendent of Bankruptcy Canada says the number of consumer insolvencies in November rose by 5.2 per cent from a year ago, while business insolvencies increased by 8.9 per cent.
The Bank of Canada raised its key lending rate five times since the middle of 2017.
The number of insolvencies decreased by 2.5 per cent in November from October with bankruptcies falling by 8.2 per cent and proposals increasing by 2.1 per cent.
For the 12-month period ending Nov. 30, the number of bankruptcies and proposals grew by two per cent with consumer bankruptcies falling by five per cent and proposals increasing by 8.4 per cent. Consumer insolvency filings accounted for 97.2 per cent of total insolvency filings.
Business insolvencies for the 12-month period ending Nov. 30, 2018, decreased by 0.6 per cent compared with the 12-month period a year prior, with the mining, oil and gas extraction and manufacturing sectors falling the most while construction and retail insolvencies sustained the greatest increases.
The number of insolvencies rose in all provinces except Nova Scotia in November compared with the same period a year earlier. Newfoundland and Labrador’s filings rose 11 per cent, followed by Alberta at 8.3 per cent. Quebec and Ontario grew by less than one per cent.