Business administrations soar 20 per cent
Business administrations in England and Wales jumped 20 per cent in the third quarter, rising to the highest level for more than five years.
In the third quarter the number of companies entering administration rose to 484 from 403 in the previous quarter.
Company insolvencies rose 0.4 per cent on the previous quarter to 4,355 in the three months to the end of September.
Read more: Peer-to-peer lender Fundingsecure enters administration
Meanwhile, compulsory liquidations decreased for the third consecutive quarter, falling 16.4 per cent compared to the second quarter.
There were 89 company voluntary arrangements (CVAs) in the third quarter compared with 92 between April and June and 94 the previous year, according to the latest statistics published by the Insolvency Service.
In the 12 months to the end of September, the accommodation and food services industries reported the largest increase in underlying insolvency volumes.
The construction industry suffered the highest number of new underlying company insolvencies, which reached 3,106.
Graham Bushby, head of restructuring at RSM, said: “This suggests that company distress levels are now accelerating. Clearly, continued uncertainty around Brexit is affecting consumer confidence and business sentiment.
“This is being compounded by a slowing in some of Europe’s major economies such as Italy and Germany, as well as ongoing concerns around the impacts from a slowdown in China.
Read more: Exclusive: Flexible office space firm Central Working falls into administration
‘The biggest rise in Administrations is in the construction sector. Houses are now taking much longer to sell as buyers remain cautious in the face of uncertainty.
“This leaves construction firms struggling to sell units to keep their head above water or finance additional phases of building.”
Main image credit: Getty