The number of UK firms hitting the wall could soon approach the numbers seen at the peak of the last recession in 1992, insolvency experts have warned.
A survey conducted by R3, which claims to represent 97 per cent of UK insolvency practitioners, predicted a 41 per cent rise in business insolvencies between 2007 and 2009.
Respondents anticipated a rise from the official figure of 13,091 in 2007 to 15,693 for 2008 and 18,440 for 2009. R3 added that this was a conservative estimate, as 18 per cent reckoned the number of casualties could hit over 20,000 by 2009.
R3’s president Nick O’Reilly stated: “The predicted 41 per cent increase in business insolvencies from 2007 to 2009 is catastrophic and unfortunately will mean we will start to approach the numbers we saw at the peak of the last recession in 1992.
“For the last three or four years a number of businesses that perhaps were not performing well have been kept alive artificially by the easy availability of credit, which has now dried up.”
R3 members also believed personal insolvencies would increase 22 per cent between 2007 and 2009.
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