A report by Begbies Traynor has concluded that there are around 127,000 UK companies which are suffering "significant financial distress". This comes at a time when the UK economy is starting to waver and the fragile nature of the ongoing recovery has been laid bare for all to see. It is estimated that these 127,000 companies owe between them around £70 billion which is a 26% increase on the first quarter of 2010.
Amid concerns that the European debt markets are still struggling with liquidity issues and problems regarding specific economies such as Greece, Spain, Italy and Portugal there are fears that we could see an EU member state default on sovereign debt in the short term. Those who believe there will be a default are pointing the finger Greece despite the fact that the country has received a massive financial bailout package from the European Union and the International Monetary Fund. So could Greece still default on its sovereign debt?
One area of concern for UK businesses is the lack of funding for small to medium-sized enterprises in the UK which is forcing many previously strong operations to cease trading. Despite the previous government placing significant pressure upon the banking industry to increase liquidity and funding for small to medium-sized businesses there is very little sign of this occurring as yet. So what can the government do?
The Financial Services Authority (FSA) has this week issued a report about the sale and rent back market which has attracted significant criticism over the last few years. This is an area of the market which many believe preys on those in financial trouble and even thought there are many sensible and law-abiding companies in this sector there are also a number of "rogues" elements. So what will the FSA do in the future?
The Office of Fair Trading has this week issued a damning report on the UK insolvency sector with a suggestion that fees are too high and recovery rates are too low. It would also appear that insolvency costs in the UK do not compare well to countries offering similar recovery rates around the world.
There has been much talk and much criticism of the UK banking industry with regards to "lacklustre" lending levels to small and medium-size businesses. However, in many ways the lending patterns of UK banks are currently reflecting the very difficult UK economic environment at the moment with the potential for further problems in the future. So are the banks right to hold back on further lending?
It has been revealed that the UK banking sector has by far and away the largest exposure of any European country to the Irish economy. Official data suggests that UK banks have exposure in excess of $230 billion which does not compare favourably to that held by the likes of Germany which is estimated to have exposure of around $175 billion.
With UK base rates still held at 0.5%, and unlikely to move in the short-term, mortgage rates are now relatively low compared to more "traditional times". As a consequence many people are looking to repay not only their minimum mortgage payments on monthly basis but also topping up these payments using their savings or other income streams. So should you repay your mortgage before any other debts?
In the midst of the current UK economic gloom a growing number of people are falling into debt and desperate to see how they can improve their situations for the future. While on the surface analysing your finances may be fairly straightforward in reality it can be very different!
As the financial environment in the UK continues to weigh heavily on the minds of many people across the country, both individuals and business people, a growing number are looking at potentially refinancing their debts. Should I refinance my debts is a question which is difficult to answer as each and every situation will be very different.
