Under the Act, passed at the end of the last parliament, administrative receivership has been abolished and companies have been given more control in the event of an insolvency. Companies will also have the task of nominating administrators instead of main creditors like the banks.

The changes are likely to spell the end for the traditional 'panels' of preferred insolvency specialists used by banks and end what have so far been close relationships.

John Alexander, head of corporate recovery at Carter Backer Winter, said: 'The use of panels would probably fall out of use going forward.'

Technically however, banks still retain the power, as floating charge holders, to veto company decisions. Insolvency practitioners are hoping banks will honour the spirit of the law by not using this power unless absolutely necessary.

'Administrators now have the role to act for all creditors, not just the banks. There is no reason why the bank should want to appoint its own administrator,' said Alexander.