Overcast

Overcast

max temp: 12°C

min temp: 9°C

Search

The pigs are coming. Find out more about

Pigs Gone Wild

here.

East Anglia: Insolvency experts warn of increase in company failures

15:14 07 February 2014

Shay Lettice, regional chairman of  R3, the national insolvency trade body.

Shay Lettice, regional chairman of R3, the national insolvency trade body.

Roger Adams Photographer 2011

Insolvency experts in East Anglia said today that an increase in the number of firms falling into administration does not signal that the economic recovery is running out of steam.

But they warned that the number of corporate failures could start to rise more widely, as firms which have struggled through the recession now succumb to increased competition from stronger rivals.

The number of companies collapsing into administration reached its highest level for nearly two years during the last three months of 2013, according to figures from the Insolvency Service.

A total of 642 administrations were recorded in England and Wales during the quarter, an 18% increase compared with the previous three months and the highest total since the first quarter of 2012.

However, all other forms of corporate insolvency fell during the final quater, with liquidations − which mainly involve smaller businesses − down 7.4% compared with the previous quarter at 3,552, receiverships 6.7% lower at 236 and company voluntary arrangements 19% down at 123.

On an annual basis, administrations were still 7% down compared with 2012 at 2,365, while there was an even bigger fall of 16% when receiverships and company voluntary arrangements are included. Company liquidations were also 7% down on 2012, at 14,982.

Kris Carpen, from KPMG’s advisory practice in East Anglia, said while the increase in administrations represented a warning that it was too early to “herald a full recovery just yet” they did not demonstrate that the upturn was losing momentum.

“The sharp increase in administration appointments for the last quarter of 2013 will come as a surprise to many, running counter to the increasingly numerous positive economic indicators,” he said.

However, he added: “The numbers should not necessarily set the hares running as history has taught us that many businesses, perhaps counter-intuitively, struggle to survive when economies pick up again as over-trading tips them over the edge.”

Shay Lettice of Peters Elworthy & Moore, eastern region chairman of the insolvency professional body R3, said: “The early stages of an economic recovery are often far more difficult for some businesses to negotiate than recessions themselves. Historically, corporate insolvencies increase as the economy exits recession.”

The overall fall in corporate insolvencies over the last quarter was in keeping with the general downward trend since the recession, with insolvencies now a third down from their peak at the end of 2008, but given the recent pick-up in the economy it was not clear how long this trend would last.

“Stuttering growth, low interest rates, and creditor forbearance have helped keep corporate insolvencies lower than they normally would have been since the recession,” he added. “Some businesses will have taken advantage of the extended gap between recession and growth to put their finances back in order, but this won’t be the case for all of them.

“The economic recovery and any future rise in interest rates is likely to put upward pressure on insolvencies. Indeed, recent R3 research found that 96,000 businesses would be unable to repay their debts if interest rates were to rise, while 166,000 businesses said they were having to negotiate payment terms with their creditors.”

1 comment

  • What a load of tory tosh ! you'll be telling us next that 'bailing out' Banks and Countries doesn't mean that they have ;failed' !!

    Report this comment

    freedomf

    Friday, February 7, 2014

Holywells Park won a Civic Voice award

Holywells Park in Ipswich was one of just 11 renovation projects to scoop a national award today.

St Margarets Street, Ipswich, from Majors Corner, in the 1930s

From the Dock, now known as The Waterfront, to the streets in and around the town centre, we see many changes in Ipswich town centre.

The Suffolk Show 2015 - 
The grand parade.

The Suffolk Show has been a regular fixture on the calendars of generations of families and as this year’s event approaches, we thought we would test your knowledge of shows past and present.

Abellio Greater Anglia

Mainline train services running through Manningtree experienced delays of up to 25 minutes this evening.

Picture: Ian Burt

A man has reported being seriously sexually assaulted in Ipswich over the weekend.

Port of Felistowe. Picture: Mike Page

Suffolk police were called to a crash involving a HGV and a car at Gate 1 of the Port of Felixstowe this afternoon.

A cordon around the Inkerman pub in Norwich Road, Ipswich following the assault

A man has been charged with grievous bodily harm after a 63-year-old received serious head injuries during an early morning assault outside an Ipswich pub.

Pet Idol Winner Melanie Wakefield with Doug the dog.

He’s beaten all the competition to come out as top dog in our Pet Idol competition – it’s Doug the Jug.

Hollesley Bay

A prisoner from Hollesley Bay open prison who failed to return following a period of home leave has handed himself in, police have said.

Emergency services are at the scene. Stock image.

Emergency services were called to a head-on crash in Ixworth Thorpe earlier this afternoon.

Most read

Most commented

HOT JOBS

Show Job Lists

Topic pages

Streetlife

Newsletter Sign Up

Great British Life

Great British Life
MyDate24 MyPhotos24