Bangkok--8 Aug--Standard & Poor's
Globally, 15 companies (13 public and two confidentially rated) defaulted in the second quarter of 2011. The volume of rated debt affected by defaulters in the second quarter was $39.5 billion, up from five defaults in the first quarter with $3.6 billion in debt, said an article published today by Standard & Poor's Global Fixed Income Research, titled "Quarterly Global Corporate Default Update And Rating Transitions."
Of the 15 defaults in second-quarter 2011, eight were domiciled in the U.S., two in Canada, two in New Zealand, and one each in U.A.E, Russia, and France. For more details about the defaulters in the second quarter, see "Second-Quarter 2011 Default Synopses," also published today.
"On a trailing-12-month basis, the global speculative-grade default rate as of June 2011 was 2%, down slightly from 2.08% at the end of March and 5.12% at the same time in 2010," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "The default rate is now at its lowest point since August 2008, the last reading prior to the collapse of Lehman Brothers and the ensuing recession in the U.S."
"Overall, credit quality has, in our view, continued to stabilize over the past 18 months, as the number of downgrades has decreased slightly across all regions," said Ms. Vazza. "The downgrade-to-upgrade ratio fell to 0.64% in second-quarter 2011 from 1.10% in the previous quarter."
The decrease from the first quarter is the result of a slight uptick in upgrades--to 3.5% from 2.45%--along with a decrease in downgrades--to 2.25% from 2.7%.
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