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Drop in Bankruptcy Filings Sends KGI to All-Time High
June 12, 2006: BETHESDA, MD - The Kaulkin Ginsberg Index (KGI), the leading indicator of economic conditions affecting the accounts receivable management (ARM) industry, jumped an unprecedented 20.5% in April to 1472.7, surpassing its former all-time high of 1301.1, set in June 2005. This increase is the greatest monthly change in the six-year history of the KGI.
The Index’s increase was based mainly on the historic fall in the number of U.S. bankruptcy filings. In the first quarter of 2006, the number of filings fell from 667,431 to 116,771, reflecting the full impact of recently adopted federal bankruptcy legislation. Kaulkin Ginsberg has been predicting a rise in the KGI due to the reduced number of bankruptcy filings.
“The new bankruptcy legislation is leading to fewer filings and requiring more debtors to satisfy their financial obligations,” said Paul Legrady, Director of Kaulkin Ginsberg’s Research Group. “This is good news for receivables management companies and the creditors they serve.”
The Index’s changes in April were caused by the following factors:
Variable |
March 2006 * |
Variable Change * |
Effect on KGI * |
Unemployment Rate |
4.7% |
0.0% |
- |
Federal Funds Rate |
4.79% |
4.4% |
Up |
Charge-off Rate |
0.42% |
-19% |
Down |
Outstanding Consumer Credit |
$2.17T |
0.4% |
Up |
Total Market Cap of ARM Stocks |
$3.22B |
3.0% |
Up |
Bankruptcy Filings |
116,771 |
83% |
Up |
| Consumer Price Index |
201.5 |
0.9% |
Up |
* See “How is the KGI Calculated,” http://www.kaulkin.com/research/kgi/calculate.cfm |
The KGI is a product of Kaulkin Ginsberg's Research Group, which provides industry-specific publications and custom research services to the ARM industry. For more information about the Kaulkin Ginsberg Index, see www.kaulkin.com/research/kgi or call Paul Legrady, Director of Kaulkin Ginsberg's Research Group, at 301-907-0840 ext. 104.
About Kaulkin Ginsberg Company
Kaulkin Ginsberg is a diversified advisory, research, and media company, providing solutions to accounts receivable management and related business services industries since 1989. The Strategic Advisory Group provides merger, acquisition, and valuation advice; operational consulting; and executive search services. The Research Group leverages Kaulkin Ginsberg’s 15 years of industry insight and relationships to provide clients with industry-specific publications and custom research products. The Kaulkin Ginsberg family of companies also includes Kaulkin Media, publisher of the most popular sources of industry information such as CollectionIndustry.com™ and Credit & Collection Daily™.
Read more about Kaulkin Ginsberg at www.kaulkin.com.
