England and Wales are on their way to record the highest number of firm insolvencies since 1993

Despite a significant decline in December, company insolvencies in England and Wales were headed for a 30-year high in the last three months of 2023, according to official data released on Tuesday.

2,002 businesses were declared insolvent last month, according to the government's Insolvency Service. This is the smallest monthly increase since July and an increase of 2% over the previous year.

Not seasonally adjusted, the number was much lower than November's reading of 2,470, the second-highest since monthly records started in January 2019.

On January 30th, seasonally adjusted quarterly statistics will be released. However, when looking at non-seasonally adjusted data, the number of firms declared bankrupt in the three months leading up to December 31 was around 6,800, the highest number since the first quarter of 1993.

For most of 2023, rising energy prices, rapidly rising wages, and the highest Bank of England interest rate in over 15 years put pressure on British firms.

Due to temporary government assistance to companies and legislative protections against forced liquidations, company insolvencies had a substantial decline during the COVID-19 epidemic. However, as of right present, monthly insolvencies are running around 50% higher than they were before the pandemic.

A portion of the rise in bankruptcies might be attributed to the increased quantity of firms that are registered in contrast to prior decades.

The pace at which corporations were being liquidated was the greatest since 2014, according to previous third-quarter figures, but it was still far lower than in previous years.

Data on individual insolvencies in England and Wales was also made public by the Insolvency Service. These figures dropped 20% in the year ending in December, reaching their lowest point since August 2020.

(Sources: investing.com, reuers.com)