Corporate insolvencies in Britain set to soar-KPMG

The number of British companies going bust grew by nearly 50 percent last year, accounting firm KPMG said on Wednesday, and with the UK economy now in recession, the number of insolvencies is set to rise further in 2009.

Ahead of the latest government figures to be published on Friday, KPMG recorded a total of 3,225 insolvency appointments in 2008 (to 23 December), compared with 2,230 in 2007, an increase of 45 percent.

The firm expects corporate insolvencies in 2009 to reach 5,000 — a further 50 percent increase on the previous year.

"The downturn is now firmly entrenched in the real economy and there are hardly any sectors that have not been hit," said Jim Tucker, a restructuring partner at KPMG.

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