Insolvency rate rises 33% in July, data shows

THE RATE at which companies are falling insolvent reached the highest level so far this year in July, when there were 151 insolvencies, according to figures issued by InsolvencyJournal.ie.

The number of insolvent firms last month was up 33 per cent on June and 132 per cent higher than in July 2008. The accelerated rate of business failures affected most sectors, the figures show.

The construction sector was hit badly, with 48 insolvencies last month. Firms in the sector may have gone into liquidation ahead of the traditional August builders’ holidays. It was also a bad month for the motor trade, with nine motor firms going out of business in July compared with three in June and four in May.

The slowdown in consumer spending weighed heavily on the retail sector. There were 30 retail insolvencies during the month, compared to 21 in June and 11 in May. Some 131 retail firms have gone out of business this year.

Ten manufacturing companies became insolvent in July, compared with six in June.

There were some signs that the hospitality sector is stabilising, with 14 insolvencies in July compared to 13 in June and 15 in May.

There was also a surge in examinerships, the process by which firms seek court protection from creditors as they try to agree a plan to rescue the company.

Some 14 firms sought court protection last month, compared to three in June and one in May.