Business insolvencies fall by 9% in February

The Insolvency Service has published its latest figures which indicates personal insolvencies in England & Wales corporate business insolvencies fell by 9% to 686 in February 2021 compared to January’s figure of 754, and were 49% lower than February 2020’s figure of 1,348.

The number of registered company insolvencies in February 2021 was 49% lower than the number registered in the same month in the previous year (1,348 in February 2020). This is the lowest monthly number since January 2019.

The 686 registered company insolvencies, comprised of 591 CVLs, 33 compulsory liquidations, 56 administrations and 6 CVAs. There were no receivership appointments.

Since March 2020, the overall number of registered company insolvencies in each month has been lower than the corresponding month of the previous year in 10 out of 11 months. In February 2021, when compared with the number of company insolvencies registered in February 2020

Compulsory liquidations were 86% lower, CVLs were 38% lower and there were 68% fewer CVAs whilst Administrations were 62% lower.

Colin Haig, President of insolvency and restructuring trade body R3 and Head of Restructuring at Azets said “The fall in corporate insolvency numbers shown in the figures published today has been driven by a reduction in all corporate insolvency processes.”.

“Despite the fall in insolvencies, February continued to be tough for businesses, individuals and the economy. The national lockdown meant people weren’t able to celebrate Christmas and New Year as they have traditionally, which will have hit a crucial trading period for many businesses, and had an impact on their success – and in some cases, survival – through the first quarter of this year.”

“Government support has been and continues to be a lifeline for many – and has stemmed rather than stopped the flow of insolvencies we would expect to see in this kind of economic climate.”

“In addition, the usual ‘trigger points’ for action, such as winding-up petitions or repossession notices, are out of the picture at the moment, and our members say many company directors are putting off examining their options as a result.”

“Now is the time for them to make the most of the Government’s decision to extend its support packages and plan ahead for when these measures end, and for anyone worried about their personal or business finances to seek advice about resolving their situation.”