01 November 2021
RITANZ Chair, John Fisk recently noted in an NBR article, that even though some industries were doing it hard there had not yet been a rise in the number of businesses going to the wall.
RITANZ Chair, John Fisk recently noted in an NBR article, that even though some industries were doing it hard there had not yet been a rise in the number of businesses going to the wall.
There were 1008 liquidations (including those of solvent companies) in the nine months to September, he said.
This compares with 1129 liquidations in the same period in 2020, and 1285 in 2019.
Because of the lockdown, the number of court applications to wind up companies was at its lowest for a September month, Fisk said.
“In my view, many of the businesses impacted to date are just closing down or hibernating, and creditors are being paid or have chosen not to take legal action to recover the debt, at this stage.
“If history is anything to go by, there is also always a lag of some months between financial hardship and formal insolvency appointments actually happening,” he said.
Government support measures had helped, as had the IRD and landlords rescheduling or waiving debt.
Banks were also being supportive, and low interest rates along with rising property values were providing small firms with options for now.