1700, from bankrupt, "probably on the analogy of insolvency, but with -t erroneously retained in spelling, instead of being merged in the suffix ...." [OED]. Figurative use from 1761.
Legally declared insolvency, or inability to pay creditors.
Note: If an individual or a corporation declares bankruptcy, a court will appoint an official to make an inventory of the individual's or corporation's assets and to establish a schedule by which creditors can be partially repaid what is owed them.
Note: An individual who is lacking a specific resource or quality is sometimes said to be bankrupt, as in intellectually bankrupt or morally bankrupt.