Insolvency Stats: May 2024

The number of registered company insolvencies in England and Wales in May 2024 was 2,006, 6% lower than in April 2024 (2,144) and 21% lower than the same month in the previous year (2,547 in May 2023, which was the highest monthly number since October 2008). Company insolvency numbers have been volatile over the past few months, but there is no clear indication of an increasing or decreasing trend.

Breaking down the number by case type, as ever CVLs lead the way with 1,590 (79%), followed by 271 Compulsory Liquidations, 126 Administrations and 19 CVAs.  And NEWS FLASH – 1 Moratorium! Numbers of CVLs and Administrations were lower than in both May 2023 and April 2024, while the number of Compulsory Liquidations was lower than in May 2023, but higher than in April 2024 .

In May 2024, CVLs accounted for 79% of all company insolvencies. The number of CVLs decreased by 5% from April 2024 and was 26% lower than during the same month last year (May 2023, which saw a record high monthly number of CVLs in the time series going back to 2000).  2023 saw the highest annual number of CVLs since the start of the time series in 1960, continuing the year-on-year increases in CVL numbers seen since 2021. CVLs had been increasing at approximately 10% per year between 2017 and 2019, before decreasing to the lowest levels seen since 2007 during the COVID-19 pandemic.

Turning to personal insolvency, 9,266 individuals entered insolvency in England & Wales in May 2024. This was 4% lower than in April 2024 and 3% higher than in May 2023.

The individual insolvencies consisted of 604 Bankruptcies, 3,716 Debt Relief Orders (DROs) and 4,946 Individual Voluntary Arrangements (IVAs).  There were 7,652 Breathing Space registrations in May 2024. This is 14% higher than in May 2023.

The number of IVAs registered in May was lower than the numbers seen over the past 12 months. The number of DROs in May 2024 increased compared to April 2024, which had already set a record high in the monthly time series going back to their introduction in 2009. The higher DRO numbers in April and May 2024 of course coincided with the removal of the £90 administration fee to obtain a DRO from 6 April 2024.

Total individual insolvency numbers peaked in 2009 and 2010 following the recession in 2008-09, before decreasing over the next five years as the number of Bankruptcies declined. An increase in IVA numbers between 2015 and 2019 then resulted in a corresponding increase in overall insolvency numbers.

The 604 Bankruptcies in May 2024, consisted of 494 resulting from debtors’ applications, which was 5% lower than in April 2024 and similar to the number in May 2023 and 110 resulting from creditors’ petitions, which was 18% lower than in April 2024 and 15% lower than in May 2023.  82% of Bankruptcies in May 2024 resulted from debtors’ applications. This is slightly higher than 79% in May 2023 and similar to percentages between 2017 and 2019, but lower than the 85-90% seen during the COVID-19 pandemic, when restrictions applied to creditor petitions.