May Insolvency Statistics released
Corporate insolvencies up again
Sydney, May 9, 2011 – According to Dissolve, a business specialising in company liquidations, the most recent release of ASIC insolvency statistics reveals that in March 2011 the number of corporate insolvencies has taken a turn for the worse.
Our key findings are:
- The number of companies entering some form of insolvency administration in the month of March 2011 was 968. That figure is the third highest calendar month ever recorded (since 1999). The only months that have been higher were at the height of the GFC being November 2008 (1,011) and March 2009 (1095).
- This follows last months data where February 2011 was the highest February on record (852).
Cliff Sanderson, CEO of Dissolve, commented that: “During 2010 the number of insolvencies dropped off the peaks from the GFC but they have now jumped back up again. We also know from our research that the dollar cost to Australian Banks of their bad debts has remained stubbornly high as they are still running at around $5.6 billion a quarter which is over 5 times pre-GFC levels.”
He added: “There are a number of factors at play. Firstly, it always takes a number of years for a financial crisis to work its way through to trading businesses. We saw a few large corporate collapses post GFC and we are now seeing a large number of smaller businesses hitting the wall. Secondly, for a period post GFC the ATO was very accommodating for companies struggling to pay taxes. That is no longer the case. Lastly, the Banks showed quite a bit of patience post GFC but for the last year or so have been more aggressive in appointing Receivers and taking possession of assets.”
For further details on this release see our Statisitcs page.