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Company insolvencies in England and Wales return to pre-lockdown levels

Published 15/10/2021, 14:08
Updated 15/10/2021, 14:27
© Reuters. FILE PHOTO: Rain clouds pass over Canary Wharf financial financial district in London, Britain July 1, 2016. REUTERS/Reinhard Krause

© Reuters. FILE PHOTO: Rain clouds pass over Canary Wharf financial financial district in London, Britain July 1, 2016. REUTERS/Reinhard Krause

LONDON (Reuters) - Company insolvencies in England and Wales rose last month and returned to levels seen just before the COVID-19 pandemic, official data showed on Friday.

The government's Insolvency Service said 1,446 companies registered for insolvency last month, up 56% from a year ago but still down 4% on September 2019.

Company insolvencies - including voluntary liquidations, administration and bankruptcies - fell sharply last year due to the COVID-19 pandemic, which caused big backlogs in courts. Some businesses that would have folded also received support from government programmes.

The bulk of the insolvencies in September comprised creditor voluntary liquidations.

© Reuters. FILE PHOTO: Rain clouds pass over Canary Wharf financial financial district in London, Britain July 1, 2016. REUTERS/Reinhard Krause

"This suggests that directors are choosing to close their businesses after deeming their financial survival unlikely after 18 months of trading through a pandemic," said Nicky Fisher, deputy vice president of insolvency and restructuring trade body R3.

Individual insolvencies showed a similar pattern. While bankruptcies were still down compared with a year ago, debt relief orders - a form of insolvency for people with debts of less than 30,000 pounds ($41,000) - rose to their highest since around the start of lockdown.

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