Rising interest rates are bad news for homeowners – but they could be a lifesaver for some businesses, according to commercial analysts at Plimsoll Publishing. “Our research shows more than a quarter of UK Tyres, Exhausts & Batteries companies are in more debt than they have been at any time in their history, “ said David Pattison, senior analyst at Plimsoll. “Rising rates are a useful wake-up call. Many of the companies in question have been enticed by low interest rates and the lure of easy debt secured on rapidly rising property prices, and so have been able to cover up flaws in their business strategies – effectively buying time. There is just enough time left for these firms to look seriously at their balance sheets and change direction.”

If companies reduce their level of debt and streamline their business models, they may have a future, according to Plimsoll. Plimsoll, which has conducted independent assessments of private and publicly quoted companies for the past 20 years, has an established track record of spotting the warning signs for businesses. Nearly nine out of 10 failed companies in the UK had earned a “danger” or “caution” rating from Plimsoll in the two years before their demise.