Mr Adrian Brown, ASIC’s Senior Executive Leader of Insolvency Practitioners, said that each month of the September quarter saw a consistently high number of appointments, notwithstanding a decrease from August (1049) to September (991), resulting in a higher quarterly total compared with both the June 2011 quarter and the same period last year.

For the quarter to 30 September 2011, there were 2,961 EXADs compared with 2,656 EXADs in the previous quarter (+11.5%) and 2,502 EXADs for the same quarter last financial year (+18.3%).

“We have now seen two consecutive quarters where appointments exceeded 2,600 with the quarter ended December 2008 being the only other occasion this occurred in recent times. For the calendar year to date, companies entering EXAD increased 9.6 per cent compared to the same period last year”, Mr Brown said.

ASIC statistics show that creditor-initiated court liquidations (+33.7%) and receivership appointments (+12.7%) drove the quarterly increase of 11.5% in EXAD appointments over the previous quarter. Court liquidations rose strongly in the two largest states of NSW (+42.6%) and Victoria (+34.4%).

“The trend towards creditor-initiated court liquidations supports feedback from insolvency practitioners that they’re seeing more activity as creditors, including the Australian Taxation Office, and various workers compensation insurers, continue to tighten up on debt recovery”, Mr Brown said.

Mr Brown also noted that appointments of receivers/controllers by secured lenders increased in NSW (+ 21.5%) and remained at high levels in Queensland where the raw number of appointments (305 over the calendar year to date) were only marginally below those of NSW (310), the largest state, and above that of Victoria (282). Receivership/controller appointments were also up in Western Australia (52.3%) for the calendar year to date compared to the same period last year.

“Feedback from the market suggests that activity in Queensland, and to a lesser extent, in Western Australia, is largely driven by property-related appointments. We understand that certain secured lenders are crystallising long-standing problem loan positions or taking control of an underlying security where other creditors initiated an external administration”, Mr Brown said.

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ASIC’s Senior Executive Leader of the Insolvency Practitioners team, Adrian Brown, said that despite a decrease in external administration appointments in May compared to the same time last year, these latest figures show the number of court liquidations and director initiated creditors voluntary liquidations have risen.

‘Statistics collated by ASIC up to and including May 2011, show court liquidations in Australia rose 8.6% and director initiated creditors voluntary liquidations rose 7.6%. Western Australia is also seeing its fair share of corporate insolvencies, despite suggestions that it’s in the fast lane of a two speed economy,’ Mr Brown said.

‘Interestingly, receivership and voluntary administration appointments, Australia-wide, have fallen,’ Mr Brown added.
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ASIC publishes monthly insolvency statistics detailing the number and type of corporate insolvency appointments. External administrators, (liquidators, receivers and managers and voluntary administrators) are obliged by law to advise ASIC of their appointments.

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