THE North East saw a 5% increase in the number of businesses going into receivership in 2011 on the previous year.

But the increase to 611 companies was still far smaller than in many regions including the South East and Scotland where the rate was nearly twice as high.

And although this was 1.44% of the region’s total business population, the highest figure in the UK apart from Yorkshire, it was not far from the national average of 1.01%.

Nationwide 21,070 UK businesses which is slightly up on the 19,818 failures recorded in 2010.

In 2008 and 2009, the insolvency rates were considerably higher, reaching 1.16% and 1.25% respectively.

Experian’s analysis also shows that during the second half of 2011 the insolvency rate neither rose nor fell significantly.

Max Firth, UK managing director for Experian’s Business Information Services division, said: “Given the challenging economic climate in 2011, businesses in the UK were pretty resilient and this was reflected by the stable insolvency rate during the year.

“For businesses to improve their financial health and avoid insolvency, it is vital that they understand the risks they are exposed to and have strategies in place to protect themselves.

“By monitoring the performance of all current and potential clients, they can fully understand and prepare for the impact they could have on them if they failed.”

Of the UK’s biggest sectors – business services, building/construction, property, IT and leisure/hotels – the property sector saw the largest increase in its insolvency rate.