Bangkok--13 Feb--Standard & Poor's Standard & Poor's has published an article titled, "U.S. Corporate Default Outlook: Defaults Appear Poised To Breach Long-Term Average (Premium)," which states that, in contrast with their benign tone in 2007, defaults are poised to breach their long-term average in 2008. "Corporate defaults, though slow to materialize, are on the first leg of an ascent that will gain momentum in the second half of 2008 and likely continue into 2009," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "A material risk remains that defaults could be significantly more pronounced and severe beyond the one-year forecast horizon." Two salient features of the default outlook are that Standard & Poor's expects the U.S. speculative-grade default rate to accelerate substantially from near its 25-year low of 1.09% in January, reaching 4.6% in the next 12 months, and that the rising volatility in the credit markets and the escalating risk of recession contribute to substantial variability in the default forecast. Factors contributing to higher downside risks for U.S. defaults include escalating risk of recession in the U.S., a substantial hike in the cost of capital, a ratings mix with a higher representation of speculative-grade issuers than at any other point in history, the highest volume of low-rated issuance since 2003, and a greater impact of seasoning in the 'B-' or lower rating categories. The reports are 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]