A recent report from Experian has shown that business insolvencies in the North West of England fell by 11% in June 2012 compared to the same period last year.
The largest decrease regionally was seen in South East with 20.7% fewer insolvencies; however the West Midlands saw the largest increase with 18.2% more business failures.
SME’s were the only group to see an improvement in the insolvency figures country wide with those employing between 51 and 100 people showing the largest decrease with a drop of 35.8% of businesses becoming insolvent on the same period last year.
Larger companies didn’t fare as well with those employing 101 to 500 people seeing 0.16% failure rate compared to 0.08% the year before and those with 500+ employees saw an increase from 0.12% to 0.15%.
Overall however there has been a slight improvement on the amount of businesses becoming insolvent in June 2012 at a rate of 0.08% compared with 0.09% in June 2011.
Managing Director and Insolvency Practitioner at Focus Insolvency Group, Anthony Fisher commented:
“Whilst on the face of it these figures look good, as they indicate fewer companies are going Insolvent, there is less money around and that in itself can impact on Insolvency figures. If a company has no assets or cash then it effectively becomes a ‘zombie’ company until a creditor or companies house liquidates or strikes it off the register. HMR&C ‘time to pay’ arrangements have also helped to reduce Insolvencies and banks are reluctant to appoint Administrators at the moment due to more bad debts and costs. As the economy recoveries, it is likely that Insolvencies will increase to remove the companies that are not viable.”