Bangkok--2 Nov--Standard & Poor's
The number of global weakest links continues to drop throughout 2010. Weakest links totaled 118 as of Oct. 21, down from 128 in September and 264 a year ago, said an article published today by Standard & Poor's, titled "Global Bond Markets' Weakest Links And Monthly Default Rates (Premium)."
Weakest links are issuers rated 'B-' and lower with a negative outlook or ratings on CreditWatch negative. The 118 weakest links have combined rated debt worth $144.06 billion.
The U.S. leads in the number of weakest links, with 86 (73%) of the 118 entities. "By sector, media and entertainment, oil and gas exploration and production, banks, consumer products, and finance companies were the most vulnerable, with the highest concentrations of weakest links," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research.
"The 12-month-trailing global corporate speculative-grade default rate fell to 3.4% in September 2010 from 3.66% in August--its 10th consecutive monthly decline," said Ms. Vazza. Regionally, the U.S. speculative-grade corporate default rate also decreased for the 10th month in a row, to 3.96% in September from 4.32% in August. In Europe, the default rate held steady at 2.72%, while the emerging markets default rate increased slightly to 1.6% from 1.59%.
Our baseline projection for the U.S. corporate speculative-grade default rate in the 12 months ending in September 2011 is 2.4%. To realize the mean baseline projection, a total of 35 speculative-grade rated issuers would need to default from October 2010 to September 2011.
The standard version of this article is part of our standard Global Fixed Income Research content. The premium version contains expanded analysis of the article's most significant points, typically broken out by sector and region. Also in the premium version are in-depth charts and tables, the underlying data of which are available for download. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.
Media Contact:
Mimi Barker, New York (1) 212-438-5054,
[email protected]
Analyst Contact:
Diane Vazza, New York (1) 212-438-2760