If you work in corporate insolvency and restructuring there is a very good reason why you may feel busier and more stressed of late. The numbers are going up (and they ain't coming down again any time soon).
The latest published insolvency statistics (Quarter 3 (Q3) to the end of September 2021) tell a story that has been a long time in the screenwriting room. In England and Wales, the number of company insolvencies, after seasonal adjustment, was 17% higher than in Q2 2021 and 43% higher than in Q3 2020. This was driven by an increase in Creditors’ Voluntary Liquidations to the highest quarterly level since Q2 2009, while numbers for all other company insolvency procedures were similar to the previous quarter and lower than in the same quarter of the previous year.
There were 3,471 CVLs, 105 Compulsory Liquidations (how?), 169 Administrations, and 20 Company Voluntary Arrangements (CVAs). There were no Receivership appointments (mainly because it is not 2001). Of course 'winders' are low and the numbers on Bankruptcies in the personal insolvency figures are sticky, to say the least; this is due to a greater extent to the huge swathes of assistance the Government has given and, to a lesser degree, is still giving people as we all peek outside the door to sniff the post-Covid air. However, there are signs of a shift in the area those in which our glorious profession would most expect to see it, as we look for earlier portents of things to come.
CVLs are the front marker; they represent the part of our workload we would expect to see moving first as the constipation of the last 20 months starts to shift with more than a rumble in the stomach of the economy. There is no doubt; we always knew we were going to get busier in the next ... epoch. Now we know it.
The above numbers are distinguished from those in individual insolvencies. In that area the number in Q3 2021 was 2% lower than in Q2 2021, with numbers of IVAs and Bankruptcies lower, while Debt Relief Orders numbers were 31% higher following changes to DRO eligibility on 29 June 2021. Total individual insolvencies were 33% higher than in Q3 2020.
The tide is turning. It is time to inflate your armbands.