Bankruptcy Statistics Based on Credit

Card Debts in Malaysia

We have total of 3.2 million credit card holders nationwide last year. Did you know how
many of them were failed to pay credit card debts and caused them bankrupt in 2009?
Make a guess?
On average, the percentage of credit card holders declared bankrupt was only 0.04% out of
the total number of principal credit card holders in the last five years, Deputy Finance
Minister Datuk Donald Lim said. Source: theSun
Surprisingly, there were only total of 405 credit card holders. I feel the figure is relatively
small compare to my expectation in mind.
So far, the Department of Insolvency Malaysia (MDL) had restructured 80,348 bankruptcy
cases from 2005 to May 2010 categorized as following:

31,950 cases Malay

26,805 cases Chinese

7,661 cases Indians

13,932 cases Others

Here are some of the cases involved in different type of loans that caused the bankruptcy:

19,380 cases for failing to settle hire purchase loans

9,464 cases for failing to settle personal loans

8,786 cases for failing to settle business loans

6,022 cases for failing to settle housing loans

4,417 cases for failing to settle credit card debts

4,291 cases for failing to settle corporate loans

3,726 stood as guarantors

Bear in mind, the collective number of bankruptcy cases have reached 218,561 nationwide
as of June 2010. So, does the bankruptcy statistics help us in analyze property market trend
in the country? Well, we will monitor and study about it.

PETALING JAYA: Bankruptcy cases are on the rise with 16,306

people declared bankrupt from Jan to Sept last year, said PKR leader
Datuk Seri Anwar Ibrahim.
During the same period, he said over 27,432 bankrupt petitions were
filed in Malaysian courts.
Anwar pinned this down to rising costs of living which forced Malaysians
to take personal loans or credit cards as their disposable incomes
diminished.
"This then exposes them to the risk of bankruptcy due to the higher rates
of interests offered by these loans," he told reporters at party
headquarters on Tuesday.
Anwar said the statistics from the Malaysian Insolvency
Department showed there was an average of 1,812 people declared
bankrupt per month last year.
In comparison, he said 2012 statistics showed an average of 1,631
people declared bankrupt per month, with a total of 19,575 for the year.
He said this was an 11% rise in the average number of monthly
bankruptcies from 2012 to 2013.
"I anticipate that when the full data for 2013 is published in March, over
20,000 bankruptcy cases will be reported due to the increase in the price
of goods and cost of living, which resulted from the subsidy
rationalisation programme," he said.
Anwar said that this phenomenon was also happening in Sabah and
Sarawak, citing Minister in the Prime Minister's Department Nancy

Shukri saying Kuching, Miri and Sibu had reported a total of 6,925, 4,058
and 2,557 bankruptcy cases respectively.
In addition, he said the 2012 statistics from the department showed that
the racial breakdown of bankruptcy cases were Malays (48.4%),
Chinese (32.2%) and Indians (14.1%).
"It is also shocking to note that a total of 4,100 or 21% of cases involved
those below 34 years old. Failure to make timely repayments for car,
housing and credit card loans were among the purported reasons for
bankruptcies," he said.
Anwar said Bank Negara data also showed that banks disbursed a
record number of personal and credit card loans last year, totalling
RM139bil compared with RM124bil in 2012 and RM67bil in 2006.
He said these income supplementary measures had to be taken due to
rising costs, and not because of the rakyat's mismanagement of
personal finances as suggested by the Government.