Bangkok--6 Feb--Standard & Poor's Despite the liquidity disruption in the credit markets, the incidence of corporate defaults in 2007 remained low, maintaining the trend prevalent in the past few years, according to an article published yesterday by Standard & Poor's. The report, titled, "2007 Annual Global Corporate Default Study And Rating Transitions," says that globally, just 22 corporations defaulted on their obligations last year, eight fewer than in 2006 and the lowest number since 1996. "The global corporate default rate for speculative-grade and investment-grade rated entities remained near the all-time low in 2007, reaching 0.36% at year end from an already paltry 0.46% in 2006 on an issuer-weighted basis," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "The total amount of defaulted debt reached $8.2 billion in 2007, which is still low by historical standards, but $1 billion higher than in the previous year." At 0.86%, global speculative-grade default rates have remained below the long-term (1981-2007) average of 4.35% for 46 consecutive months. By region, the U.S. speculative-grade default rate ended 2007 at a 25-year low of 0.97%, compared with 0.95% in Europe and 0.18% in the emerging markets. In 2007, the total number of defaults was the lowest recorded since 1996, with all defaulters originally rated speculative grade ('BB+' or lower). Further, low defaults again coincided with high recovery rates, with U.S. ultimate recoveries in 2007 posting their highest rates in two decades, aided by healthy economic conditions and plentiful liquidity in 2006 and the first half of 2007. Ms. Vazza added that, "Analysis of the transition rates over the four quarters ended December 2007 suggests that ratings behavior is remaining consistent with long-term trends, showing that higher credit ratings are associated with lower default probability, and vice versa." 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.