The 20 Biggest Bankruptcies in U.S. History

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by visualcapitalist

Doing business means taking calculated risks.

Regardless of whether you are opening a lemonade stand or you’re a leading executive at a Fortune 500 company, risk is an inevitable part of the game.

Taking bigger risks can generate proportional rewards – and sometimes, such as for the companies you’ll read about below, the risk-taking backfired to queue up some of the biggest bankruptcies in U.S. history.

Going For Broke

Today’s infographic comes to us from TitleMax, and it highlights the 20 biggest bankruptcies in the country’s history.

Companies below are sorted by total assets at the time of bankruptcy.

The 20 Biggest Bankruptcies in U.S. History

There are times when companies are forced to push in all of their chips to make a game-changing bet. Sometimes this pans out, and sometimes the plan fails miserably.

In other situations, companies were actually unaware they were “all-in”. Instead, the potentially destructive risks were not even on the radar for many executives in the company, materializing only through a global crisis or unanticipated Black Swan events.

The Biggest Bankruptcies in the U.S.

Here are the 20 biggest bankruptcies in U.S. history, and what triggered them:

Rank Company Year Assets at Bankruptcy Downfall
#1 Lehman Brothers 2008 $691 billion 2008 financial crisis
#2 Washington Mutual 2008 $328 billion 2008 financial crisis
#3 Worldcom Inc. 2002 $104 billion Accounting scandal
#4 GM 2009 $82 billion Massive debt
#5 CIT Group 2009 $71 billion Credit crunch
#6 Pacific Gas & Electric 2019 $71 billion Wildfires
#7 Enron 2001 $66 billion Fraud
#8 Conseco 2002 $61 billion Failed acquisition strategy
#9 MF Global 2011 $41 billion European sovereign bonds
#10 Chrysler 2009 $39 billion Massive debt
#11 Thornburg Mortgage 2009 $37 billion Declining mortgage values
#12 Pacific Gas & Electric 2001 $36 billion Drought
#13 Texaco 1987 $35 billion Contract dispute
#14 FCOA 1988 $34 billion Savings and loan crisis
#15 Refco 2005 $33 billion Accounting fraud
#16 IndyMac Bancorp 2008 $33 billion Mortgage market collapse
#17 Global Crossing 2002 $30 billion Plummeting world economy
#18 Bank of New England 1991 $30 billion Bad loans
#19 General Growth Properties 2009 $30 billion Failed acquisition strategy
#20 Lyondell Chemical 2009 $27 billion Decline in demand

The data set on the biggest bankruptcies is organized by assets at time of bankruptcy. Therefore, they are not in inflation-adjusted terms, meaning the list skews towards more recent events.

This makes the impact of the 2008 financial crisis particularly easy to spot.

The events and consequences relating to the crisis (loan defaults, illiquidity, and declining asset values) were enough to take down banks like Lehman Brothers and WaMu. The after effects – including a slumping global economy – led to a second wave of bankruptcies for companies such as GM and Chrysler.

In total, nine of the 20 biggest bankruptcies on the list occurred in the 2008-2009 span.

A Dubious Distinction

You may also notice that one company was on the list twice, and this was not an accident.

Pacific Gas & Electric, a California company that is the nation’s largest utility provider, has the dubious distinction of going bankrupt twice in the last 20 years. The first time, in 2001, resulted from a drought that limited hydro electricity generation, forcing the company to import electricity from outside sources at exorbitant prices.

The more recent instance happened earlier this year. Facing tens of billions of dollars in liabilities from raging wildfires in California, the utility filed for Chapter 11 protection yet another time.

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