Register to get free articles
Want unlimited access? View Plans
Already have an account? Sign in
Corporate insolvencies increased 71% in Q3 with formal corporate insolvency appointments currently over 50% higher than levels in 2021, according to the latest statistics from the Insolvency Service.
Between 1 July and 30 September 2022 (Q3 2022), there were 5,595 (seasonally adjusted) registered company insolvencies, comprising 4,800 creditors’ voluntary liquidations (CVLs), 492 compulsory liquidations, 274 administrations and 29 company voluntary arrangements (CVAs).
It also found that after seasonal adjustment, the number of company insolvencies in Q3 2022 was 1% lower than in Q2 2022 but 40% higher than in Q3 2021. The number of CVLs remained close to the highest quarterly level since the start of the series in 1960 (Q2 2022).
The number of compulsory liquidations also increased to the highest quarterly number since the start of the coronavirus pandemic, but remained lower than pre-pandemic levels.
In addition, one in 213 active companies (at a rate of 46.9 per 10,000 active companies) entered liquidation between 1 October 2021 and 30 September 2022. This was an increase from the 29.3 per 10,000 active companies that entered liquidation in the 12 months ending 30 September 2021.
Nicola Banham, Insolvency director at Azets, said: “These latest insolvency statistics for Q3 evidence a significant increase in the volume of companies feeling financial stress. There were 16,105 corporate insolvencies in the first three quarters of 2022 compared to 9,433 during the same period in 2021 – a 71% rise.
“This pressure will continue to build as companies face ever increasing costs at a time of prolonged economic uncertainty. Alongside this, the cost of servicing debt is rising due to increasing interest rates, which are expected to continue to rise and further exacerbate matters.”
She added: “The most common insolvency procedure is liquidation – bringing the business to an end. Directors should seek advice from an insolvency practitioner at the earliest opportunity, to understand the alternative options available which may save some or all the business.”
