February 2024 saw 2,102 registered company insolvencies in England and Wales - an increase of 17% compared to the amount registered in 2023. It is also higher than the January 2024 figures and when government support measures were in place in response to the pandemic.
Of the 2,102 registered company insolvencies in February 2024:
Figure 1: The number of registered company insolvencies in February 2024 was higher than in the same month last year, driven by higher numbers of CVLs, compulsory liquidations and administrations.
Sources: Insolvency Service (compulsory liquidations only); Companies House (all other insolvency types)
For individuals, the total number of insolvencies in February 2024 was 10,136, 23% higher than in the same month in the previous year (8,239 in February 2023).
The individual insolvencies consisted of:
The higher number of individual insolvencies compared to February 2023 was driven by a 44% increase in the number of DROs and 16% increase in both the number of bankruptcies and IVAs. Numbers in February include an unusually high number of IVAs (more than 1,000) approved more than two months earlier but not registered until February 2024.
Figure 2: IVA, bankruptcy and DRO numbers in February 2024 were higher than in February 2023.
Source: Insolvency Service
Dan Hancocks, CoCredo, MD, says: Despite the challenges businesses encountered last year due to economic turbulence, they continue to persevere. Even though rising fuel, energy, funding costs, and cautious consumer spending still pose significant challenges to their bottom lines, businesses strive to overcome these obstacles. Despite the difficulties, SMEs remain undeterred and optimistic about their ability to turn things around.
Despite some firms expressing optimism about the future, the current economic conditions remain a significant cause for concern. Companies will likely turn to insolvency processes to resolve their financial issues if substantial improvements don't happen.
Directors and management teams must remain vigilant and take immediate action. Their proactive approach is vital in identifying any signs of financial distress in their business early on, providing ample time to make informed decisions, explore different options, and increase the likelihood of rescuing the company. By staying alert and taking prompt action, they can stay ahead of the curve and navigate their business through any challenges.
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