Do you know what were the largest bankruptcies ever? Bankruptcy is a term that no company would ever want to hear during its operations. To put it simply, bankruptcy is a legal process that an organization executes whenever they are unable to pay its obligations and debts due to a lack of funds. 

The company’s debts can be forgiven partially or fully depending on the capacity to pay off liabilities at a given period of time. Most businesses can refer to bankruptcy as something similar to that of a “fresh start”. 

However, the case is not always the same for some corporations who have not been able to financially restart after losing the trust of lenders and other funders. Legal authorities would usually take over the proceedings and ultimately decide whether a corporation is eligible for bankruptcy or not. 

Throughout the years, many businesses both small and large have filed for bankruptcies. And throughout these years, some have emerged successfully to restart their operations. Here are some of the largest bankruptcies to ever occur in corporate history.

20. LATAM Airlines

Largest Bankruptcies

LATAM Airlines is a Chile-based company that is considered to be one of the largest airlines in the entire South American region. Prior to filing, the organization partnered with several countries namely Peru, Ecuador, Colombia, Brazil, and the United States. 

LATAM Airlines filed for Chapter 11 bankruptcy in New York due to the financial losses that it experienced which were accelerated by the COVID-19 pandemic. The airline currently owes an estimated $17.96 billion to several entities.

19. WorldCom Inc.


WorldCom Inc. was previously regarded as one of the largest long-distance carriers in the United States. However, everything came crashing down after the company was rocked by an accounting fiasco that led to the imprisonment of several top executives including CEO Bernard Ebbers who was given a 25-year prison sentence. 

Shortly after the legal proceedings, the company filed for bankruptcy. Before the bankruptcy process commenced, WorldCom Inc. was valued at around $104 billion. 

18. General Motors 

General Motors

General Motors was once a top player in the automobile industry — belonging to the fabled “Big Three” companies that dominated the entire market. After a series of bad business moves that eventually dropped General Motors’ value, the company filed for Chapter 11 bankruptcy. 

While the company has been able to pick itself up later, General Motors had to come to an agreement to exchange its issued bonds to investors for partial ownership of the company. Before filing, General Motors was valued at $89 billion. 

17. Washington Mutual Inc.

Washington Mutual

Washington Mutual Inc. was a United States bank that everybody had high expectations for during its initial year of operations. Unfortunately, things took a turn for the worse when the company was severely impacted by the 2008 mortgage crisis that plagued several businesses in the country. 

From its initial share price of $30, the value of Washington Mutual stocks sharply dropped to a measly $2 in the span of a year. In the ensuing panic, many customers had deposited their savings from the bank which totaled around $16.7 billion. 

The company filed for Chapter 11 bankruptcy and was regarded as one of the worst failures in the banking industry. Prior to filing, Washing Mutual Inc. had assets that amounted to around $327.9 billion. 

16. Conseco Inc. 


Conseco was an insurance firm based in Indiana that made financially sound moves during its peak — even reaching a trading value of around $58. However, the confidence that the company had in its performance was misplaced as several bad financial moves had forced Conseco to file for Chapter 11 bankruptcy — the third largest filing during the time. 

The company was unable to pay its debts after making several acquisitions and issuing loans that were left unpaid. Conseco was previously valued at $61 billion. 

15. Enron Corporation


The infamous legacy of Enron is one of the biggest scandals to rock the United States economy. After whistleblowers uncovered accounting inconsistencies and fraudulent acts that were commonplace within the energy company’s ranks, Enron Corporation finally filed for bankruptcy after it was unable to pay off its outstanding debts. 

Several executives such as Kenneth Lay and Jeffrey Skilling were arrested in the process. Before the company went downhill, Enron Corporation was valued at $66 billion.

14. Chrysler 


Chrysler was another automobile maker that did not escape the recession of 2008. Along with General Motors, Chrysler was also included in the famed “Big Three” corporations. 

With sales plummeting to over a 30% decrease, no amount of support (which included a $4 billion government bailout plan) could save Chrysler from filing for bankruptcy in 2009. Chrysler had over $39.3 billion in valued assets.

13. Pacific Gas and Electric Company

Pacific Gas and Electric Company

Pacific Gas and Electric Company is considered the largest public utility in the state of California. The company filed for two bankruptcies; one in 2001 and another in 2019. The first bankruptcy was due to a change in California’s regulation policies brought about by market manipulation and high demand for electricity. 

The second bankruptcy occurred because of the wildfire insurance liabilities accumulated by PG&E that amounted to $30 billion.

12. Thornburg Mortgage

Thornburg Mortgage CEO
Larry Goldstone former CEO of Thornburg Mortgage

Thornburg Mortgage initially had no signs of slowing down as its business model of issuing big-time mortgage loans to customers with good credit scores was relatively sustainable. 

However, Thornburg Mortgage was caught in the crossfire of the Global Financial Crisis in 2008 which contributed to the decline in house sales and the uptrend of default payments. 

Even a $1.35 bailout plan was not enough to save the company and Thornburg Mortgage filed for Chapter 11 bankruptcy — the organization was valued at $36.5 billion prior to filing.

11. Texaco Inc.


Texaco Inc. is a highly regarded oil company in the United States. The company had done relatively well in its business until it faced a legal issue stemming from a merger agreement with another oil brand, Pennzoil, which was called the “largest civil verdict in United States history”. 

The courts decided that Texaco pay $10.53 billion in damages. Unable to pay the costs upfront, Texaco Inc. filed for bankruptcy. During the filing, the oil company was worth $35 billion in assets.

10. CIT Group Inc.

CIT Group

CIT Group Inc. is an American financial service and assistance company that has been in operation since the early 1900s. 

However, the company had made several business moves that indicated signs of an impending bankruptcy such as the sale of its home lending department to its reorganization into a bank holding company in order to receive financial support from the Troubled Asset Relief Program.

 CIT Group eventually went bankrupt in November 2009 with over $65 billion in liabilities owed.

9. J.C. Penney

J.C. Penney

J.C. Penney is a department store that retained a huge market share in the industry in the United States. However, the COVID-19 pandemic had hit the retail store hard especially when the government ordered the closing of most businesses in the country. 

In response, J.C. Penney filed for Chapter 11 bankruptcy with 20,000 employees fired and a third of its stores permanently closed in the aftermath. The company had over $7.16 billion in liabilities. 

8. Hertz


Hertz is a car rental company based in America that was also hit hard by the economic impact of the COVID pandemic. However, the warning signs for the company had already been felt beforehand with the rise of competition such as Uber and price increases in maintenance and lease costs. 

Hertz eventually filed for Chapter 11 bankruptcy after accumulating $24.3 billion in liabilities. 

7. Frontier Communications

Frontier Communications

The telecom company Frontier Communications experienced a huge financial decline in the 21st century after multiple expensive acquisitions and piling customer complaints have driven the organization to the ground in 2018. 

The final nail in the coffin was a bankruptcy filing after Frontier Communications had accumulated $21.86 billion in outstanding debt.

6. Intelsat


Intelsat was a satellite services company based in Luxembourg which had shown signs of financial struggle prior to its bankruptcy filing. But the COVID-19 pandemic had launched a flurry of financial hits to the company which proved to be too much in the end. 

Since Intelsat’s business model relied on not only providing services for transportation such as airlines and maritime businesses but also live events such as sports, the pandemic had totally shut down Intelsat’s source of income. 

The company eventually filed for Chapter 11 bankruptcy with over $16.8 billion in debt.

5. Thai Airways

Thai Airways

As the premier airline of Thailand, Thai Airways had a reputation for being one of the best around the world. However, as profits began to decline which led to a decrease in customer satisfaction, Thai Airways was on the brink of huge financial losses. 

Eventually, the last straw was when the COVID pandemic hit, and Thai Airways was forced to file for bankruptcy after collecting around $10 billion in debt.

4. McDermott International

McDermott International

McDermott International was an energy engineering company that had operated in over 54 countries at its peak. However, after a flurry of negative scenarios had hit the company such as lawsuits and net losses, McDermott International was unable to fulfill its debts which amounted to around $9.86 billion, and filed for Chapter 11 bankruptcy.

3. Neiman Marcus Group

Neiman Marcus Group

The Neiman Marcus Group is known all over the United States as a mega-retailer that specialized in selling luxury goods. 

While the company had been a part of several companies that filed for bankruptcy when the COVID pandemic hit, Neiman Marcus Group had already experienced close calls when debts were piling up even way back in 2005. As of the filing, the company had over $6.79 billion in liabilities. 

2. Valaris


Incorporated in London, Valaris was a well-known drilling company that had been in business as early as the 1970s. While the company had a good streak early on, the gradual decline in commodity prices which was further accelerated by the coronavirus pandemic was too much to handle for Valaris. 

Eventually, the company had to file for bankruptcy — collecting around $7.85 in outstanding debt during the process.

1. Lehman Brothers Holdings Inc.

Lehman Brothers Holdings

Lehman Brothers Holdings Inc. is a financial services company that had been in operation in the United States as early as the 1850s. At its peak, the organization was recorded as being the fourth-largest investment bank in the entire country. 

However, even the giants of the industry were not protected from the most disastrous events in the American economy — the 2008 mortgage crisis. Feeling the impact of the crash headfirst along with countless allegations of market manipulation and fraudulent tactics plaguing the organization from all sides, Lehman Brothers Holdings Inc. was forced to file for bankruptcy which remains to be the biggest filing to this day with the valued assets of the company being estimated at around $639 billion.

To this day, the downfall of the company remains to be one of the biggest falls from grace that the entire business world of the American economy has ever witnessed in modern times.

What was the Biggest Bankruptcy in the World?

One of the biggest bankruptcies in the world to date is the one filed by Lehman Brothers Holding Inc., which, as previously mentioned, has been measured at a value of around $639 billion before it had processed its assets for liquidation in order to pay off its outstanding debts. 

What Industry has the Most Bankruptcies? 

According to data from Statista, the industry which faces the most filed bankruptcy cases since the turn of the 2020s is the Finance industry. 

While the data shown is most relevant for the United States, the same could probably be said for finance industries in different corners of the world. 

The volatility of the financial market at unpredictable periods of time can be a key reason why most companies who enter this industry face a greater risk of bankruptcy. 

Who has filed the most Bankruptcies in the United States?

In terms of the volume of bankruptcies filed in the United States, the state of California has been recorded by the American Bankruptcy Institute as having the most bankruptcies filed consistently. 

According to cumulative data as of 2022, California has around 7,496 bankruptcies filed — with the number expected to go up as the months pass by. Furthermore, as of the first half of 2021, the state of Alabama had filed the most personal bankruptcies in the United States. 

Based on data from Statista, around 300 out of 100,000 individuals in the state alone had filed for bankruptcy.