There were 34,108 declared bankruptcies across England and Wales in the final quarter of 2018, the highest single quarter figures since 2010, according to the Office of National Statistics (ONS) and the Insolvency Service.

The data released by the UK government also showed that there were 115,299 insolvencies for the whole year, the highest since 2011. Personal insolvencies rose 35% from Q3 to Q4 2018, and are also 35% higher than in the same quarter in 2017.

Stuart Frith, president of insolvency and restructuring trade body The Association of Business Recovery Professionals, said: “Personal insolvency numbers have been rising steadily every year since 2015, and 2018 was no exception. As banks and other lenders have tightened their credit standards in response to the Bank of England’s concerns around consumer over-indebtedness, many people have run out of road.

“In previous years, the ‘helicopter money’ provided by PPI refunds, along with generally less stringent lending requirements, helped to paper over the cracks that opened up as a result of a decade of persistently stagnant wage increases, but these avenues look to be closing themselves off. People are having to spend more of their income on housing and transportation, leaving less left over for savings and making budgets more vulnerable to shocks.”

Excluding one-off ‘bulk insolvency events’, seasonally adjusted corporate insolvencies in 2018 rose 10% from 2017. Excluding these one-off events, there were 16,090 insolvencies in 2018.

Seasonally adjusted corporate insolvencies fell by 9% in Q4 2018 compared to Q3 2018, but rose by 11% compared to Q4 2017.

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Recent research from R3 and ComRes found that one in five British adults (20%) would find it somewhat difficult, very difficult or impossible to immediately pay an unexpected bill for an amount as little as £20, without assistance from an external source.

In January 2018, the Bank of England’s credit conditions survey found that unsecured credit to households contracted, following a rise in default rates in Q4 2017, and that lenders expected the credit contraction trend to continue.

That month, the governor of Bank of England Mark Carney said the BoE was ‘comfortable’ with the banks’ exposure to motor finance, which did not pose a risk to financial stability.