Bangkok--2 Nov--Standard & Poor's
Globally, 19 companies (17 public and two confidentially rated) defaulted in the third quarter of 2010. The volume of rated debt affected by defaulters in the third quarter was $57.3 billion, and the U.S. accounted for nearly $55 billion of the total, said an article published today by Standard & Poor's, titled "Quarterly Default Update And Rating Transitions (Premium)."
Of the 19 defaults in third-quarter 2010, 13 were domiciled in the U.S., three were from emerging markets, two were based in New Zealand, and one was from Japan. For more details, see "Third-Quarter 2010 Default Synopses (Premium)," also published today on RatingsDirect.
Globally, the corporate default rate for speculative-grade-rated entities was 0.67% at the end of third-quarter 2010, compared with 0.61% in the second quarter and 2.15% in third-quarter 2009.
"On a trailing-12-month basis, the global speculative-grade default rate as of September 2010 was 3.4%, down from 9.7% at the same time this past year and a high of 9.9% in November 2009," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "The decline over the past two months has pushed the default rate below its long-term average (1981 to September 2010) of 4.4% for the first time since February 2009, which indicates improving lending conditions for corporate borrowers."
Overall credit quality has, in our view, started showing signs of stabilization relative to a year ago. The number of downgrades has declined significantly across all regions--the downgrade-to-upgrade ratio fell to 0.56% in the third quarter of 2010 from 0.94% in the second quarter and 2.7% in third-quarter 2009.
This article is part of our premium Global Fixed Income Research content, which is available to premium subscribers to RatingsDirect on the Global Credit Portal at www.globalcreditportal.com and to RatingsDirect at www.ratingsdirect.com. 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:
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Analyst Contact:
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