Bangkok--12 Oct--Standard & Poor's Based on a universe of $2.96 trillion in corporate debt rated by Standard & Poor's Ratings Services as of Sept. 28, 2007, potentially $47.9 billion will be refunded in the last quarter of this year, according to an article published on Wednesday, Oct. 10, 2007, by Standard & Poor's. The report, titled "Refunding Outlook For U.S. Corporate Bonds: 8% Of Debt May Be Refinanced In 2008," said that in 2008, potentially $251 billion in corporate debt will be refinanced, based on maturity schedules for all U.S. fixed and floating corporate bonds rated by Standard and Poor's. "U.S. corporate bond issuance has been on a record pace this year, with $855 billion in debt issued in three quarters of the year versus $705 billion in the same period in 2006 and $551 billion during the same period in 2005," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "Of the $855 billion in new issuance, $751 billion was of investment grade, while $104 billion was of speculative grade. However, speculative-grade issuance has tapered off in the past three months, as the leverage finance market has been disrupted by contagion from the mortgage-backed security market. However, we expect issuance to resume, albeit at a more moderate pace." There will be $31.4 billion in investment-grade maturities for the fourth quarter of 2007 and $206 billion in 2008. The high-yield category will have $4.7 billion mature in 2007, with $36.4 billion due in 2008. Based on the current universe, we expect that maturing debt will spike in 2011, as 10-year debt comes due that was issued during the issuance bubble in 2001. In 2011, we expect $300 billion will mature, $89 billion of which is speculative-grade debt. Ms. Vazza added "We currently project a 25 basis points rate cut in October, though recent labor statistics increase the likelihood that the Fed Reserve will hold. We expect that the Treasury yield curve will steepen over the next eight quarters and the spread between 10-year Treasury and two-year Treasury long-term rates to increase to 69 bps at the end of the second quarter of 2008 and to 82 bps by the end of 2008. And, we project $8.4 billion in calls between now and the end of 2008 for issues rated 'BB-' or above, while another $21 billion could be called from lower rated issues if conditions are optimal. However, another round of market disruptions would decrease call volume by increasing volatility, depressing prices, and potentially increasing the difficulty and cost of refinancing, which could force some potential calls to a much later date." The report is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-9823 or sending an e-mail to [email protected]. Ratings information can also be found on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. 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