Insolvency Statistics – January 2015

Insolvency Statistics – January 2015

A Year in Review


2014 was a slow year for insolvency appointments which have dropped to levels not seen since before both the GFC and the finance company crashes.  The graph below shows the insolvency appointments (liquidations, receiverships and administrations) for the last four years.  The drop is clear, from 2,974 in 2011 to 2,481 in 2014.  That’s a drop of nearly 17%.


Year to Date Comparison of Insolvency Appointments 2011 to 2014


The following graph shows a quarter by quarter analysis of the same data.  As you can see, while 2014 shows lower numbers of appointments, the general trend is the same year of year with the exception being the 1st quarter which showed a significant drop.


Quarter by Quarter Comparison of
Insolvency Appointments 2011, 2012, 2013 & 2014


There are, historically, a few key months in the calendar year where it is common to see increases in appointments.  For example; the beginning of the 2nd and 3rd quarters when management data becomes available and the directors/shareholders realise there is a problem.  December and January are two other good examples.  In December, many company directors realise the difficulties they are facing and recognise that their company may not be able to trade through the Christmas period.  While in January, an unexpected poor performance over the Christmas break may force directors and shareholders to reconsider the company’s future.  It becomes sobering when the realisation dawns that cash flows cannot sustain present trading activity let alone ensure that both IRD debt is serviced and employees holiday pay entitlements are met.  Insolvency appointments therefore are traditionally high in this period despite it being a holiday period.  The fourth quarter 2013 and the first quarter 2014 buck that trend.


What does stand out in 2014 compared to previous years, is the lack of receivership appointments being made by secured lenders.  The total receivership appointments in 2011 were 280 and rose to 286 in 2013 but fell to 125 in 2014.  It certainly appears to us that secured lenders are trying to work through problems with their clients and seek a sensible exit solution where, in the past, they may have opted to exercise their security sooner rather than later.


However, if you take a look by month, it is interesting to see the fluctuations.


Month by Month Comparison of
Insolvency Appointments 2011, 2012, 2013 & 2014

What the figures are showing?

  • There were 162 insolvency appointments in December 2014 which is more than 2013 but significantly less than previous years.  There were 19 receivership appointments, 158 liquidations recorded and no administrations.
  • Total insolvency appointments for 2014 were 2,481.  Liquidations accounted for 2,348 of those appointments.
  • Applications made to the High Court to liquidate companies totaled only 48 for December 2014.  Applications made between January and December 2014 totaled 1,264 of which 891 were made by the IRD.