Business failures up 17% this year

THE number of liquidations, receiverships and examinerships jumped 17% in the first nine months of the year compared with last year.

It is now expected that up to 1,850 failures will be recorded for the full year, up from 1,570 in 2009.

Figures compiled by FGS show that 1,330 companies were placed in liquidation, receivership or examinership in the first nine months of this year.

However, the number of failures in the first three quarters of 2010 has continually reduced, falling from 469 in the first quarter to 418 in quarter three.

More than a third of all failures occurred in the construction sector, with the main casualties being small- to medium-sized developers and sub-contractors.

Partner with FGS, Declan Taite, said: “The ongoing reduction in house prices, a virtual stop in the number of new units being built, uncertainty regarding the availability of credit for small- to medium-type developers and purchasers all indicate that much uncertainty is likely to prevail in the short term.

“The uncertainty is likely to be further compounded as the transfer of toxic loans to NAMA continues.”

Dublin continues to account for the majority of failures with 567, or 43%, taking place in the capital.

In Cork the number of failures increased from 110 in 2009 to 130 this year.

There were also significant increases in the number of failures in Wexford (22 in 2009, as opposed to 44 in 2010) and Clare (19 in 2009 against 36 in 2010).

The figures show stability in the number of failures in the hospitality sector, such as pubs, restaurants and suppliers to the industry where 169 collapses occurred, or 13%.

One sector badly hit was retail with a significant increase in failures, at 115, a near 100% increase on the 58 in the same period in 2009.

There was a large increase in the number of receiverships (123%) recorded in the first nine months of 2010 when compared with the same period in 2009.

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