Insolvencies down as businesses turn to CVAs
Figures published by the Insolvency Service show an overall decrease in the number of insolvencies this quarter, with firms turning instead to other methods such as CVAs to settle their debts.
Corporate insolvencies were down 19.1% in the second quarter of this year compared to the same period last year. There were 4,080 company liquidations in total, a 0.5% increase since the start of the year.
Compulsory liquidations reduced by 21% on the previous year, with 1,169 companies taking this route. The number of businesses entering into creditors’ voluntary liquidations (also known as company voluntary arrangements, or CVAs) went up by 5.4% on the previous quarter, with 2,911 companies choosing this method.
Restructuring experts predict the downward trend for insolvencies will continue, as more businesses opt for CVAs and other arrangements.