Insolvencies fall 13.2 percent in first quarter

LONDON (Reuters) - More than 25,000 people declared themselves insolvent in England and Wales in the first three months of the year, government figures showed on Friday, but that was 13.2 percent lower than in the same period last year.

The Insolvency Service said personal insolvencies rose 1.7 percent on the quarter to 25,264. This comprised 15,651 bankruptcies and 9,614 people coming to a formal agreement with their creditors to pay at least some of what they owe.

The number of companies going to the wall also picked up in the first quarter, rising 2 percent on the quarter to 3,210 -- 4 percent higher than a year ago.

"The number of people being affected could rise substantially if credit conditions stay tight for some time to come, market interest rates remain elevated, the economy suffers an extended marked slowdown and unemployment starts rising," said Howard Archer, an economist at Global Insight.

"It is the people with the weakest credit ratings that are liable to be hit the hardest by tighter lending conditions, higher interest rates and more punitive terms."

(Editing by Mike Peacock)