The number of West Midlands businesses declared insolvent fell to 144 in April – a drop of almost ten per cent compared to the same month last year.
The region saw a decrease of 8.3 per cent of firms unable to pay their debts last month, according to Experian.
The latest insolvency index shows this as 0.09 per cent of the West Midlands business population, again down from 0.10 per cent for the same month last year.
The region saw its financial health score – the likelihood of a business failing in the next 12 months – improve from 82.75 in 2011 to 83.46 in 2012.
Max Firth from Experian said: “The figures show a more stable business environment, with some areas and sectors that have historically seen the highest rates of business failures moving in the right direction.
“Since January 2009, when the average financial strength score of UK firms had fallen to its lowest level recorded, there has been a definite and positive upward trend.
“Combined, these two valuable indicators show how UK businesses are faring and highlight areas where there are opportunities, as well as risks.”
UK-wide 1,564 businesses failed during April 2012 compared to 1,808 firms in April 2011 and the country as a whole saw its average financial health score improve marginally from 83.24 to 83.76.
The East Midlands and Scotland were the only two areas to see their insolvency rate increase – both rose from 0.07 per cent to 0.09 per cent.
Of the UK’s five biggest sectors – business services, building/construction, property, IT and leisure/hotel – property saw the biggest improvement in April – falling from 0.12 per cent to 0.06.
This was followed by the building and construction sector from 0.18 per cent to 0.15.
The index also highlighted that medium sized firms, with 51 to 100 employees, which have traditionally struggled the most, were the most improved during April, with insolvencies down from 0.22 per cent to 0.10 per cent.
They were also one of the categories to see the biggest month-on-month fall, from 0.20 per cent in March.
Smaller businesses with 26 to 50 employees saw a similar month-on-month fall – from 0.24 per cent in March to 0.16 per cent in April.