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Insolvencies dip as firms see out storm

THE number of companies declared insolvent fell last month, research showed today.

A total of 1,834 firms went insolvent during the month – 15 per cent down on February last year, according to business information services group Experian.

The group said the fall brought the overall rate of insolvencies down from 0.11 per cent to 0.1 per cent.

London had the highest number of insolvencies, with 452 companies going under in February, up from 428 12 months earlier.

The North-West was next at 245, while Wales had the lowest number at 45.

Rolf Hickmann, managing director of pH, an Experian company, said: “Small businesses have far more flexibility than any other business type.

“It is easier for smaller businesses, with just one or two employees, to easily make adjustments to their operations and pull in the reins when times are difficult.

“For larger business, there is the security that comes with size and a well-established structure, so insolvency rates among these business types are also low.

“However, mid-sized businesses, which are seeing the highest rates of insolvencies, are too large to be flexible and too small to rely on a strong and established structure.”

Last month’s figure was an increase on January’s rate of 0.08 per cent.

However, January is traditionally a quiet month where fewer companies go bust. There were 58 insolvencies in the North East.

FAST FACTS | INSOLVENCIES
1,384 companies went into insolvency last month – down 15 per cent on February 2009

London saw the highest number of insolvencies in the UK with 452 companies going under compared with 428 last year