Corporate Insolvency Drops Again

Corporate insolvencies have dropped yet again in the UK in January with the North West seeing the most favourable improvement.

The UK as a whole has seen a 24% drop compared to January 2009, whereas the North West has dropped by a massive 37.5%. These new figures come from the information service company Experian show. The drop has seen business insolvencies at their lowest rate since June 2007.

The decrease comes despite insolvencies in Scotland showing a 20.3% increase, this was the only UK region included in the research that has shown any form of increase.

Financial strength also improved in the UK from 79.46 to 81.16, this is an indicator which shows the likelihood of a business failing over the next 12 months. It is measured on a scale of 1 to 100, with 1 being the most likely to fail.

The managing director of Experian company pH has said, “It’s encouraging to discover that not since the current financial crunch started have so few firms become insolvent in a single month.

“While it is too early to predict whether we are fully out of the woods, this does hint at an improvement in the health of UK businesses, something which is reinforced by the financial strength view provided by January’s data.”

The figures have also shown that the highest insolvency rate was amongst companies that employed between 11 and 100 people whereas the lowest rate was in very small firms with 1 or 2 employees.

Also, Breweries and plastics and rubber companies saw the highest insolvency rates for business types.

Posted at 02:23PM Feb 22, 2010 by Marc Stenton in Insolvency  |  Comments[0]