The number of people whose finances became so bad that they were declared insolvent in the first three months of 2015 is expected to be at its lowest quarterly levels in a decade in official figures released tomorrow.

Restructuring and recovery firm Baker Tilly said its data suggests that the Insolvency Service will announce tomorrow that there were just over 21,000 personal insolvencies in England and Wales in the first quarter of this year.

If this happens, it would be the lowest quarterly total seen since 19,511 insolvencies were recorded across the last three months of 2005.

There are three types of official personal insolvency in England and Wales. These are bankruptcies - which tend to be seen as a "last resort" option, individual voluntary arrangements (IVAs) - which are agreements whereby money is shared out between creditors, and debt relief orders (DROs) - which are often dubbed "bankruptcy light" because they are aimed at people with smaller amounts of debt but no realistic prospect of paying it off.

Despite the overall downward trend in in personal insolvencies seen in recent years, as low interest rates have kept the cost of borrowing relatively cheap, Baker Tilly expects to see an increase in bankruptcies within tomorrow's figures as the hangover from Christmas takes its toll.

In the last three months of 2014, a total of 22,433 personal insolvencies were recorded, of which 4,267 were bankruptcy orders. Baker Tilly predicts that just over 4,500 bankruptcy orders will have been made in tomorrow's figures.

Mark Sands, a personal insolvency partner at Baker Tilly, said: "We see this spike in bankruptcy orders every year and it often happens because people tend to put off dealing with their debt until after Christmas, which is a time when people are also likely to overspend. So this is the Christmas and New Year hangover."

Baker Tilly also expects that around 6,200 DROs and 10,300 IVAs will have been recorded in the first three months of this year.

DROs were introduced in 2009, and their use has generally been on a downward path since around 2012.

Mr Sands said several factors are helping the trend towards a steady decline in personal insolvencies generally.

He said: "People have smaller personal debts, largely due to more sensible lending by creditors in recent years. This is resulting in individuals being less likely to need to enter into official insolvency procedures to get themselves in the clear.

"Also, because creditors are showing more forbearance, people are now approaching them directly to arrange repayment plans."

The predictions were made as a separate report, released by the British Bankers' Association (BBA), found that annual growth people's borrowing using personal loans, overdrafts and credit cards is at its strongest since autumn 2010 - which the BBA said reflects "improved consumer confidence".

Mr Sands cautioned that with lending growing, "if we start to see a rise in interest rates, this could lead to levels of personal insolvency going up in the coming years".