Business

Surge in number of companies going to the wall

There was a 21.5 per cent increase in the number of company's going under in the last three months
There was a 21.5 per cent increase in the number of company's going under in the last three months There was a 21.5 per cent increase in the number of company's going under in the last three months

COMPANY insolvencies in Northern Ireland rose by more than a fifth over the last quarter, new figures show.

Some 79 firms went to the wall over the July to September period, according to the Insolvency Service.

That represents an increase of 21.5 per cent on the same quarter in 2018.

Of these, 45 were compulsory liquidations (up from 30 previously) while 27 were creditors' voluntary liquidations (up from 24 before).

There were also three administrations and four company voluntary arrangements.

And over the same period, there was a whopping 34 per cent increase in personal insolvencies to 718, made up of 410 individual voluntary arrangements, 143 bankruptcies and 163 debt relief orders.

Gareth Latimer, director of recovery and reorganisation at Grant Thornton in Belfast, said: “The increasing numbers of insolvencies in Northern Ireland in the third quarter is hardly surprising given the current political and economic uncertainty being experienced at a local, national, and global level.

“Given the recent UK general election announcement and the Brexit extension, it will be interesting to see if the number of insolvencies continues to rise.

“And should the rates increase further over the remainder of 2019 and into next year, it would do little to alleviate the concerns of some economic analysts that have already pointed to signs of a possible looming recession.”

The regional figures largely mirror those in the rest of the UK, where the number of people going financially insolvent has remained at near-decade highs.

The Insolvency Service said personal insolvencies have now remained at the highest quarterly level since the end of 2010 for the past four quarters.

The figures also showed the number of company insolvencies rose to its highest level for more than five years.

Duncan Swift, president of insolvency and restructuring trade body R3, said the data is "further evidence that the economic and political turbulence of the last 12 months has taken its toll on businesses".

He added: "For some businesses, restructuring through an insolvency procedure is the best means of dealing with stalled growth."