Corporate Insolvencies Fall

Business insolvencies dropped significantly to 2,160 in total for March 2010, compared to 2,512 in March last year, according to research.

The figures, published by pH, part of credit reference agency Experian, revealed that insolvency cases in March 2010 rose slightly from February, but were still significantly lower than in March 2009, which the number of business insolvencies peaked.

All regions, apart from Scotland, saw a small rise in insolvency cases in March compared to February. Scotland was the only region to see its insolvency rate fall in this period, with cases down from 0.09 per cent in February to 0.08 per cent in March. The East Midlands, Greater London and the south east respectively had the highest number of insolvency cases.

 Rolf Hickmann, managing director of pH, said: “Unlike the last recession, when business insolvencies were more than double the rates witnessed during this recession, the business economy has not been admitted to intensive care.

 “In fact, insolvencies have been coming down since early 2009 and, despite the odd monthly fluctuations, are now far more stable.”

 Insolvencies in the media, electrics and food retailing industries all showed small rises, while other sectors reported a drop in the number of cases. The property, retailing and leisure and hotels industries reported significantly less insolvency cases than March 2009, indicating that there is a slow recovery from recession in these sectors.

 The average financial strength score for UK businesses also deteriorated slightly from 81.18 in February to 80.99 in March. Small businesses of one to two employees suffered the biggest deterioration, but compared to March 2009 the average financial strength of businesses showed significant improvement.

 Hickmann added: “It’s the same picture when you look at the financial strength score. Although this deteriorated slightly in March, it has been steadily getting back to normal since the economic crisis was at its worst in mid 2008.

 “Despite March’s figures, our data shows that micro businesses, the one and two man-bands, are the most resilient in the UK.”

Posted at 03:27PM Apr 26, 2010 by Marc Stenton in Insolvency  |  Comments[0]