LONDON, Oct 29 (Reuters) - England and Wales have seen a
surge in company directors winding up businesses that are unable
to pay their debts, taking so-called voluntary liquidations to
their highest level since 2009 in the depths of the global
financial crisis.
Total company insolvencies in England and Wales jumped in
the three months to the end of September to their highest since
the start of the COVID-19 pandemic at 3,765, up 43% on a year
earlier, government data showed on Friday.
Forced liquidations of companies remained near an all-time
low, due to legal restrictions on creditors' ability to act
against businesses during the pandemic, as well as a 79
billion-pound ($109 billion) programme of government loan
guarantees.
But creditors' voluntary liquidations - which in normal
times account for two thirds of insolvencies - rose to their
highest total since the three months to the end of June 2009 in
the latest quarter at 3,471, more than 90% of the total.
"Relative calm waters - largely due to the unprecedented
government economic support over the last 18 months - may be
giving way to stormier seas," said Richard Tett, head of the
insolvency practice at law firm Freshfields.
Businesses were likely to come under further pressure in the
coming months due to a surge in energy prices and the removal of
legal restrictions on forced insolvencies, Tett added.
Friday's data showed 26,758 insolvencies for individuals in
England and Wales in the three months to September, a third more
than 12 months ago, when they hit a five-year low, but below
their level in the previous quarter and before the pandemic.
Court-ordered bankruptcies of individuals, which account for
only a small share of total insolvencies, fell to their lowest
since 1989 at 1,938.
($1 = 0.7253 pounds)
(Reporting by David Milliken
Editing by William Schomberg)