Businesses face financial distress

By www.brokernews.com.au, 21 May 2010

Climbing interest rates, dwindling government stimulus action and tight credit conditions will continue to make recovery difficult for 80,000 Australian businesses that had their risk profile downgraded.

The latest risk research from Dun & Bradstreet reveals the number of firms downgraded has risen by close to 15,000 compared to the same time last year, a period when the local and global economy was continuing to face significant pressures from the global credit crisis.

The research also reveals that downgrades have resulted in more than 36,000 Australian firms being classified as a high risk of experiencing financial distress in the coming 12 months.

Dun & Bradstreet's director of Corporate Affairs, Damian Karmelich says: "It's an important sign that risk remains prevalent and firms must be constantly vigilant".