KPMG predicts dramatic rise in corporate insolvencies

KPMG Restructuring predicts that corporate insolvencies, administrations and receiverships will rise dramatically in 2009 reaching 5,000 by the end of the year.

This compares to 3,225 insolvency appointments in 2008 and 2,230 in 2007: a 45% increase in appointments from 2007 to 2008, show KPMG’s figures.

Jim Tucker, of KPMG Restructuring and one of KPMG’s leading large-scale insolvency practitioners says: “The downturn is now firmly entrenched in the real economy and there are hardly any sectors that have not been hit.

Confidence is a key driver behind consumers’ and business’ willingness to spend money, and right now confidence is at a low ebb.

“A number of companies and their stakeholders are trying hard to restructure their businesses, but given the speed of the downturn it is inevitable that some will run out of cash.”