Steve Wybo: Metro Detroit bankruptcies at a trickle — but that won’t last – Crain’s Detroit Business
Steve Wybo was featured in Crain’s Detroit Business’ article titled “Metro Detroit bankruptcies at a trickle — but that won’t last.”
“It’s unavoidable and inevitable,” said Steve Wybo, senior managing director of Birmingham-based turnaround firm Conway MacKenzie Inc. “Even the sharpest V-curve (economic recovery) possible won’t save everyone. Many companies went three months with no revenue and lots of those companies can’t go three months and survive in the long term.”
Instead, companies are working with people like Dragich and Wybo to stretch their payables and survive the coronavirus recession long enough that the economy turns around.
Wybo predicts bankruptcies will start showing up in the Eastern District court by mid-August when the federal programs dry up and receivables are no longer being paid throughout industry supply chains.
“Banks will start seeing a lot more companies in default on their covenants (debt agreements), and it won’t be from just short-term dips in liquidity,” Wybo said. “The problems will have moved to the profit and loss (balance sheet) performance. We’re expecting a bloodbath is going to occur.”