Experian’s latest Business Insolvency Index reveals the rate of UK insolvencies fell from 0.11 per cent in December 2011 to 0.07 per cent in January this year.
The January 2012 rate is now the same as in January 2011.
Business services and leisure/hotels were among the sectors producing the most optimistic data, according to the global information services group.
The fall in the UK’s insolvency rate was led by businesses with 101 to 500 employees, according to Experian. Failure rates among these mid-sized businesses fell from 0.21 per cent in December 2011 to 0.10 per cent in January 2012.
The new Experian index also highlighted an improvement in the financial health among businesses.
In larger companies picture is not so rosy. The insolvency rate of firms with more than 501 employees, however, reached 0.20 per cent in January, up from 0.07 per cent the year before. The increase in the rate of insolvencies for the largest firms highlights the continuing need of businesses of all sizes to understand the risks they are exposed to.
Max Firth (pictured), UK Managing Director for Experian’s Business Information Services division, said: “The fall in the overall rate of insolvencies has taken it back down to the level it was at a year ago, which is certainly positive.
“January generally tends to be a good month, with many businesses benefiting from the Christmas trade. When coupled with steady improvements in the underlying financial strength of businesses, it means that we can entertain some cautious optimism for the months ahead.”
In terms of regional variations, Experian’s data shows Yorkshire led the way with the biggest improvements; the insolvency rate of local businesses fell from 0.15 per cent in December to 0.09 per cent in January.
London and the South East was next best permer, with the rate falling from 0.10 per and 0.11 per cent to 0.05 per cent.
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