Bankruptcies on the rise

The number of people declaring themselves bankrupt increased by 75% in the third quarter of this year.

Figures from the Ministry of Justice showed that 13,653 people in England declared themselves bankrupt in the three months to September; the third consecutive quarter of increases.

The number of bankruptcies now stands at the second highest level in over a decade.

The rate at which companies were being wound up in the third quarter was also up, by 13% on same period in 2007 and 9% compared to the second quarter of 2008.

Howard Archer, chief UK and European economist at IHS Global Insight, said: "The marked rise in the number of companies being wound up in the third quarter is a clear taste of things to come as extended marked economic contraction, very tight credit conditions and intense competition will exact an increasingly heavy toll on companies.

"Similarly, individual bankruptcies are poised to surge over the coming months in the face of recession, faster rising unemployment, higher debt levels, very tight credit conditions and more and more people being trapped in negative equity."

Earlier this month it was revealed that insolvencies in England and Wales rose by nearly 9% in the third quarter.