The latest Centrix Credit Indicator for August shows company liquidations are up 26 percent year-on-year, partly due to increased enforcement activity by Inland Revenue.
But chief operating officer Monika Lacey said the jump was nothing to be concerned about.
“I think the important context to provide here is that in New Zealand, we have over 700,000 registered businesses, of which 600,000 or nearly 600,000 are active.
“So, as an actual number of businesses that are going into liquidation, when you’re talking in the hundreds, it is a very small number compared to the overall ecosystem.
“There’s no doubt that those businesses and those people behind those businesses are hurting and that it impacts a lot of families, which is not what we want.
“But I think that context is really important that again, majority of businesses are actually doing okay, so it’s definitely tough out there for some, but it’s not catastrophic by any stretch,” she said.
The construction industry remained the leading industry contributing to the liquidations, with a total of 765 companies liquidated in the last year, an increase of 46 percent compared to the previous year.
“I think construction is impacted largely by a lot of consumer confidence, so there’s probably not a lot of renovation going on.
“There’s been a big slowdown in migration, which is impacting real estate, so I think that whole picture is really impacting that particular sector.
“But hopefully, as we come into spring, we’ll start to see some of that changing,” Lacey said.
Hospitality was the second-largest industry contributing to company liquidations, with 297 recorded in the past year, up 49 percent on the prior year.
Property followed close behind at 287 recorded in the last year, followed by retail and transport.
It also continued to be a challenging period for small to medium enterprises, with elevated stress across multiple sectors.
Consumer arrears also up
Consumer arrears had edged up to 12.41 percent of New Zealand’s credit active population in July, 1.3 percent higher than a year ago.
The number of people behind on payments increased by 480,00 – a 2000 increase on June.
After six months of improved arrears positions when compared to last year, last month was marginally worse than 2024.
However, late-stage arrears (90+ days past due) had eased slightly, suggesting some early signs of stabilisation.
Meanwhile, mortgage arrears improved to 1.38 percent in July, with 21,200 home loans past due – 400 fewer than the previous month.
The improvement was most evident in early arrears, while 30+ day arrears had stabilised.
