New Zealand's economic activity went into negative territory at the end of 2008 and didn't become positive again until March 2010.
Grant said people typically took a bit of time to go into bankruptcy after losing their job or income as they had a "bit of fat in the system".
"If people lose their job or their business it takes a while for creditors to make a move. As far as indicators for upcoming problems, bankruptcies tend to be an indication of what happened 12 months ago."
Grant said the increase was pretty small and bankruptcy levels remained at historical lows.
"It appears to be back around the 2006 levels," he said. "It is still a bit of a rock star economy."
Anecdotally Grant said he was seeing more people trying to make a deal to repay their debts rather than giving up, which indicated they felt confident about their future and the ability to pay the money back.
The biggest reason people gave for going into bankruptcy in the 2014 year was losing their job or income with one in five people citing that.
Typically more males than females go bankrupt and they are more likely to be white and in their late 40s.
Grant said the biggest mistakes people made that landed them in bankruptcy were failing to try and make a deal with the person or business they owed money to, not selling the family home and not telling their other half about financial difficulties.
"People are quite reluctant to bankrupt someone, most people would rather do a deal. But where people come unstuck is refusing to deal with the person they owe money to. That causes that person to harden their stance and the debt increases." Grant said people often left it too long before going into bankruptcy.
"If they can't pay, people should go bankrupt. People fight for too long and end up living in misery." He said there was a misconceived view of what the official assignee's job was.
"The role of the OA is there to protect bankrupts. They are not there to hound them for their money.
"If you are in financial trouble your whole life is rubbish. Once you go bankrupt the pressure release is huge."
Grant said declaring bankruptcy allowed people three years to sort their lives out.
The other major mistake was staying in their house for too long.
"People have an emotional attachment to their house. If they lose their job, have a marriage break-up and can no longer sustain the payments, that is what kills them. All of the money goes on paying the mortgage."
He said another problem was people failing to tell their significant other about their financial woes.
"Men don't talk to their wives."
He said in his experience women were better at adjusting to the change and focused on what needed to be done.
"The men are so committed they take a long time to confront reality whereas the wife will say liquidate the company and go get a job. Men don't put their hand up fast enough."
What happens when you go bankrupt
• Bankruptcy normally lasts 3 years and during this time a bankrupt can't leave the country, go into or manage a business, or be employed by a relative without the consent of the Official Assignee.
• During the bankruptcy a bankrupt can't raise credit in excess of $1000 without disclosing their bankruptcy and must advise the Official Assignee of where they are living, working and what they earn.
• Available assets (with the exemption of some statutory assets that remain with a bankrupt) will be sold and the proceeds used to repay creditors.
• Public notification of the fact of the bankruptcy is recorded on the ITS website and stays there for at least 7 years.
Why people go bankrupt
Cause plus percentage using this reason in year to June 30, 2014:
Unemployment or loss of income: 20%
No response: 13%
Liabilities due to guarantees: 9%
Adverse legal action: 8%
Adverse economic conditions affecting industry: 7%
Failure to provide for taxation: 7%
Domestic discord or relationship breakdown: 7%
Excessive use of credit facilities: 6%
Other: 6%
Ill health or absence of health insurance: 5%
Lack of sufficient working capital: 3%
Excessive interest payments: 3%
Lack of business ability including under-quoting or failure to assess potential of business: 2%
Inability to collect debts due to disputes, faulty work or bad debts: 1%
Gambling, speculation and extravagance in living: 1%
Failure to keep proper books of account and costing records: 1%
