Insolvency rate at lowest level for more than five years
THERE was a marked reduction in the number of West Midlands companies becoming insolvent in January compared to the first month of 2012.
Some 90 companies became insolvent in our area compared to 140 12 months before. The percentage of companies failing is 0.06% compared to the January 2012 figure of 0.09%.
The latest Insolvency Index from Experian, the global information services company, reveals a significant drop in the rate of business insolvencies across the UK. The January 2013 figures were at the lowest level since June 2007.
The UK’s mid-sized firms saw the biggest fall in insolvency rates in January 2013, as businesses with between 26-50 employees and 51-100 employees, experienced a fall from 0.20 % in January 2012 to 0.14% in January this year and 0.14% to 0.07% respectively.
The largest firms (those with over 501 employees) saw their average insolvency rate fall from 0.20% in January 2012 to 0.15% in January 2013.
Max Firth, managing Director, Experian Business Information Services, UK&I said: “Although January is typically a slow month for business insolvencies, the figures for January 2013 do show a marked decline in the insolvency rate, which in fact has hit its lowest level for over five years. This follows a relatively stable 2012, which itself was an improvement on the previous year.
“High profile insolvencies so far this year show that it is still a challenging climate and businesses across all sectors and sizes need to adapt to changes in their trading environment.”
The most significant falls in insolvency rates stemmed from Scotland, with 0.03% of the business population failing. This follows the steady downward trend that Scotland experienced throughout 2012, followed by the North East, East Midlands and West Midlands.
