The pace of bankruptcy filings in 2021 is at 10-year lows, as federal stimulus money and lender forbearance efforts keep financially strapped businesses from heading to the courts to restructure their debts.

According to the American Bankruptcy Institute, commercial bankruptcy filings during the first nine months of 2021 dipped 32% to 17,311 from the 25,436 filings during the same period in 2020. Chapter 11 filings decreased 47% during the first nine months of 2021 from the same period a year ago, as the 2,924 filings declined from the 5,531 filings in 2020.

In September, commercial Chapter 11 filings totaled 247, a 67% decrease from September 2020’s total of 749 filings.

Said ABI Executive Director Amy Quackenboss: “Although filings are at a historic low, with the expiration of many government stabilization programs, diminishing lender forbearance, and greater supply chain challenges due to the pandemic … businesses may begin to feel lost in these uncertain economic times,”

S&P Global Market Intelligence has also tallied historic lows in business bankruptcies this year.

In the first nine months of the year, 334 corporate bankruptcy cases were filed, a lower total than any of the previous 11 years, S&P said. (The analyst firm has an asset floor for the bankruptcies it counts, leading to lower totals.)

And in September, just 32 companies entered bankruptcy proceedings, a slowdown from 36 in August. (See charts at the end of the story.)

Smaller companies with less access to capital markets are heading to courts more frequently than larger public companies, said S&P, with no companies with more than $1 billion in liabilities filing for bankruptcy since July.

Some of those small businesses are using the relatively new, speedy Subchapter V reorganization, which through legislation had its ceiling for a filer’s debt level raised to $7.5 million from the previous $2.7 million. According to Bloomberg, in 2020, about 23% of total Chapter 11 filings used the Subchapter V option.

Overall, consumer discretionary industries have been hardest hit by bankruptcies this year, with 59 filings so far, said S&P. “The sector largely comprises companies that sell goods and services viewed as nonessential, like vehicles and apparel, and shouldered much of the direct impact from pandemic-related lockdowns and restrictions.”

Distressed companies in all industries kept afloat by the federal government and lenders could face trouble next year as their funds run out. Credit conditions may also “start to tighten as the Federal Reserve expects to wind down its ultra-loose monetary policy,” according to the October 11 S&P report.

“I don’t think you’re going to see any uptick in bankruptcies until the second quarter of [2022],” Robert Hirsh, a partner in Lowenstein Sandler LLP’s bankruptcy and restructuring department, told S&P.