Database back up output collation issue

[Derivo]

Hello users, every time I do a back-up im my store the resulting sql file collation is latin1_swedish_ci and this is a problem because front and back office will not work with this language. As a result the "colaltion" has to be changed in the back-up file using phpmyadmin if I intend to load back up DB again. Changing to utf-8 general_ci solves the issue. Now why is the back office creating the file in latin1_swedish_ci

 

Any clues?

 

P.S. 1.6.1.1 recently upgraded