News

8% decrease in corporate insolvencies Jan to Sept 2014

Construction, retail, hospitality and motor sectors see decreases in corporate insolvencies

Rent receiverships predicted to increase significantly

There was a decrease of 8% in the number of corporate insolvencies recorded in Ireland for the first nine months of the year to the end of September 2014 when compared to the same period in 2013, from 1,025 to 942 according to figures released today by Deloitte and published by www.InsolvencyJournal.ie.  

The figures show both increases and decreases across the various industry sectors. The construction, retail, hospitality and motor industries have all seen a decrease so far in 2014 when compared to the same period in 2013 while the IT and transport sectors have seen increases in corporate insolvencies.

Findings of the Deloitte analysis:

  • Jan to Sept 2014 overall corporate insolvencies at 942, a decrease of 8% (2013: 1,025)
  • Jan to Sept 2014 insolvencies in construction sector at 198, a decrease of 24% (2013: 259)
  • Jan to Sept 2014 insolvencies in retail sector at 137, a decrease of 6% (2013: 146)
  • Jan to Sept 2014 insolvencies in motor sector at 23, a decrease of 28% (2013: 32)
  • Jan to Sept 2014 insolvencies in IT sector at 35, an increase of 35% (2013: 26)
  • Jan to Sept 2014 insolvencies in transport at 27, an increase of 29% (2013: 21)

With regards to the types of insolvencies there is a reduction in creditors’ voluntary liquidations 11% (703 to 624) and receiverships 6% (261 to 244), with increases in both court liquidations 23% (47 to 58) and a marginal increase in examinerships of 14% (14 to 16).  

Corporate receiverships have dropped 6% from 261 Jan to Sept 2013 to 244 during the same period in 2014; however these numbers do not include rent receiverships.  The Department of Finance has begun to publish figures related to this type of receivership - the most recent report, published this month, noted that the six main lenders (AIB, BOI, PTSB, ACC, KBC & Ulster Bank) reported that they had 4,691 rent receivers in place at the end of August 2014.  If these continue at their current pace Deloitte predicts that 6,141 rent receivers will be in place at the end of 2014, a massive 93% increase on totals of 3,179 at the end of 2013.

The Insolvency Service of Ireland (ISI) issued Quarter 3 2014 statistics this week which show numbers are low but increasing month-on-month.  There was an 18% increase in the number of protective certificates issued from Q2 2014 (152) to Q3 2014 (180) with the number of insolvency arrangements approved increasing 6% from Q2 2014 (124) to Q3 2014 (131).  There has also been an overall acceptance rate of 72% by creditors for DSA and PIA solutions; and a significant increase in bankruptcies- Q2 2014 98 up to 137 in Q3 2014. Figures also show that the ISI is dealing with nearly €1 billion of debt so far this year.

Looking at the totals across the three areas including; corporate insolvencies, rent receivers and personal insolvencies to end of quarter 2 the overall total reaches 5,532, this includes corporate insolvencies of 650, rent receivers of 4,660, bankruptcies of 98 and DRN, DSA and PIA arrangements approved of 124 (no preceding year comparative available as ISI statistics fist published in Q1 2014).

Commenting on the outlook for the remainder of 2014, David Van Dessel, Partner, Restructuring Services, Deloitte said: “We expect the reduction in overall corporate insolvencies to remain at the current pace for the remainder of 2014.  As yet, we have not seen any significant activity around the new examinership lite legislation but are hopeful that this process will become an option for struggling SMEs to explore in the remaining months of 2014 and beyond.  In relation to personal insolvency and rent receivers, current signals would point to an anticipated increase in activity in both of these areas.”

InsolvencyJournal.ie is an independent and unique news service site that produces regular, timely, high quality articles and statistics across all industries and lists daily updates on insolvency notices (creditors meetings, appointments and petitions) across the country.

Ends

For further information please contact
Aoibheann O’Sullivan
Murray Consultants
01 498 0346
aoibheann.osullivan@murrayconsult.ie

Claire Quinn
PR Manager
Deloitte
01 417 2356
cquinn@deloitte.ie

About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/ie/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.

The information contained in this press release is correct at the time of going to press.

Deloitte’s 1,350 people in Dublin, Cork and Limerick provide audit, tax, consulting, and corporate finance services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges.
Deloitte has in the region of 200,000 professionals, all committed to becoming the standard of excellence.

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