Bangkok--5 Nov--Standard & Poor's As of Oct. 15, distressed issues across only eight sectors cumulatively affected debt worth $8.6 billion, down considerably from the $14.3 billion reported last month, according to an article published by Standard & Poor's on Oct. 31, 2007. The report, titled "U.S. Distressed Debt Monitor: Fed-Induced Relief Rally Lowers Distressed Ratio," said that based on debt volume, the media and entertainment sector had the largest portion of the total, constituting 44%, followed by consumer products at nearly 20%. "After rising for two months, the U.S. distress ratio fell back to 2.3% in October from 3.2% in September," said Diane Vazza, head of Standard & Poor's Global Fixed Income Group. "After five consecutive months of relative stability at less than 1%, the distress ratio has become more volatile in the last three. At 2.3%, the distressed ratio is below its 2.6% level recorded 12 months ago. Much of this reduction is attributed to the narrowing of spreads after the Federal Reserve reduced the federal funds rate by 50 basis points on Sept. 18." In line with the recent decline in aggregate market spreads, all basis-point thresholds (including 800 bps and 600 bps) were affected. Most noticeable was the drop at the 600 bps level, which dropped 42% month over month, compared with 10% at 800 bps and 29% at 1,000 bps. The average spread for nondistressed speculative-grade bonds fell to 392 bps on Oct. 15 from 444 bps on Sept. 13. By number of issues, the consumer products, retail/restaurants, and transportation sectors displayed the highest distress rates as a share of total speculative-grade rated issues, with consumer products leading the way at nearly 10%. Despite widespread increases in distressed issues, fully 10 sectors recorded distress ratios of zero. Ms. Vazza added, "The total number of rated companies with issues trading at distressed levels dropped to 120 from 168 in the previous month." 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 Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 8,500 employees, including wholly owned affiliates, located in 21 countries, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com. Key Contacts: Americas Media Relations: (1) 212-438-6667 media_ [email protected] Americas Customer Service: (1) 212-438-7280 [email protected]