Number of company failures to fall

The number of companies going to the wall is likely to fall over coming months, according to one practitioner, who yesterday predicted that personal insolvency will take off as the new service kicks in this month.

Corporate insolvency and restructuring specialists Kavanagh Fennell said yesterday that 116 companies had gone out of business in May, a 25 per cent fall on the 155 that folded during the same month last year.

"The total number of business failures from January to May 2013 stands at 609 compared with 742 from January to May 2012, an 18 per cent drop," the firm reported in its weekly Insolvency Journal.

Commenting on the figures, Kavanagh Fennell partner David Van Dessel predicted that the number of insolvencies is likely to continue to fall for the rest of the year.

“ However personal insolvency is expected to come to fore over the next six months and beyond,” he said.

The new Insolvency Service of Ireland is expected to begin taking applications from those interested in acting as personal insolvency practitioners, that is advisers to anyone who wants to use the service, from this month. From next month, the new service is expected to begin to take applications from individuals who are seeking debt settlement arrangements or personal insolvency arrangements.

Mr Van Dessell also predicted that the number of examinerships would increase once the Oireachtas passed new legislation making this option more accessible for smaller businesses.

In cases where the failure of a group involves the winding up of more than one company, the Insolvency Journal counts this as a single insolvency, other publications may count the winding up of each connected group company individually.