The number of firms going bust fell by almost 9% in the first three months of the year, despite three rate rises since last August, according to business information firm Experian.

It found there were 4,433 failures in the first quarter of 2007, 430 fewer compared with the same period in 2006. The figures are a stark contrast with last year, when more than 20,000 firms went to the wall.

The textiles and clothing sector made the brightest start to the year with a 30% fall in failures, while motor traders also saw a drop back more than 27.5% in the first quarter.

The hotel and leisure sector was the hardest hit among the seven sectors experiencing tougher conditions, with a 14.8% increase in corporate failures. In total, 25 out of 34 industries reported a decline in business failures.

And while most regions including London, the East Midlands and the north-west reported large falls, the north-east saw an increase of nearly 17%, with higher numbers of failures seen in Scotland and Northern Ireland.

The figures come as research from professional services firm Ernst & Young showed UK-listed companies issued more than 100 profit warnings in the first three months of year - the highest number for the period since 2001.