The number of corporate insolvencies seen across the Midlands more than halved during the first six months of 2021, despite the ongoing impact of the coronavirus pandemic.
New research suggests the various government financial help measures and a supportive lending community continued to facilitate businesses trading their way through the pandemic.
Analysis of notices in The Gazette by Interpath Advisory, the former restructuring practice of KPMG UK, reveals that 33 Midlands-based companies fell into administration from January to June 2021 – down from 82 in the first half of 2020 and 84 in 2019.
Nationally, a total of 301 companies fell into administration or receivership from January to June 2021 – down from 655 in the same period last year and 686 in 2019.
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The analysis comes following publication of new figures from HM Treasury which reveal that nearly £80 billion of emergency, government-backed loans were received by UK businesses during the covid-19 crisis.
Companies from across the West Midlands received £5.9 billion in loans while those in the East Midlands received £4.7 billion.
Chris Pole, managing director and head of the Midlands team at Interpath Advisory, said: “The dichotomy of having historically low insolvency rates at a time of significant economic crisis is naturally prompting concern in some quarters that the taxpayer is propping up an army of zombie companies.
“But, while it is fair to say that insolvencies are being suppressed artificially thanks to the raft of support available, we also know there are lots of good businesses out there whose balance sheets are broken solely due to the impact of the pandemic.
“So it is only right that they continue to be given the time and the support to be able to build their way back out of the crisis.”