Bangkok--22 Mar--Standard & Poor's
The number of global weakest links decreased to 108 as of March 15, 2011, from 111 the previous month and 203 in March 2010, said an article published today by Standard & Poor's, titled "Global Weakest Links And Default Rates: Declines Continue." The 108 weakest links have total rated debt worth $138.20 billion.
Weakest links are issuers rated 'B-' and lower with a negative outlook or ratings on CreditWatch negative.
The U.S. has the most weakest links, with 71 of the 108 entities (65.7%). By sector, media and entertainment; oil and gas exploration and production; chemicals, packaging, and environmental services; banks; and consumer products have the highest concentrations of weakest links.
So far in 2011 (through March 15), only three issuers have defaulted. The 2011 defaults are U.S.-based Ahern Rentals Inc. on Feb. 16, U.S.-based Sbarro Inc. on Feb. 1, and Czech Republic-based SAZKA a.s. on Jan. 13. Together, these three issuers affected debt worth $1.2 billion.
"The 12-month-trailing global corporate speculative-grade default rate fell to 2.47% in February from 2.49% in January--its 13th consecutive monthly decline," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "Regionally, the U.S. speculative-grade corporate default rate decreased for the 15th month in a row, to 2.75% in February from 2.76% in January. In Europe, the default rate fell to 1.49% from 1.52%, and the emerging markets default rate decreased to 1.23% from 1.41%."
Global corporate speculative-grade issuance remains strong in 2011, totaling $89.5 billion through March 16. New issuance reached a record-high $345 billion in 2010, following $203 billion in 2009 and only $56 billion in 2008.
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095,
[email protected]
Analyst Contacts:
Diane Vazza, New York (1) 212-438-2760