Bangkok--3 Jun--Standard & Poor's
Since its peak in September 2007 of 395 issuers, upgrade potential has been on an almost continuous decline to its present tally of 147 issuers, said an article published today by Standard & Poor's, titled "Upgrade Potential Across Credit Grades And Sectors (Premium)." This is the third-lowest count on record since our data series began in 1995 (the lowest was 136 issuers in March 2009).
On the other hand, potential downgrades are at 1,004 issuers in May, following April's 1,028 entities, which is the highest on record since our series began in 1995.
Potential upgrades are defined as issuers that have either a positive outlook or ratings on CreditWatch with positive implications across rating categories 'AA+' to 'B-'.
Much of the drop in upgrade potential is the result of credit deterioration across the globe, especially in the U.S. and Europe, where adverse economic conditions and frozen credit markets have effectively reduced an upward trajectory for even strongly positioned issuers.
"Largely as a result of financially strong issuers that had access to cheaper credit over the past few years, which aren't as affected by the current credit freeze, the telecommunications sector remains the only sector exhibiting a higher current positive bias than its long-term average," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "But, this differential has been gradually tightening over the months as both stronger credits see upgrades materialize and fringe credits are marginalized by credit and liquidity fears."
The standard version of this article is part of our standard Global Fixed Income Research content. The premium version contains expanded analysis of the article's most significant points, typically broken out by sector and region. Also in the premium version are in-depth charts and tables, the underlying data of which are available for download. Ratings information can also be found on Standard & Poor's public Web site at www.standardandpoors.com; under Ratings in the left navigation bar, select Find a Rating. 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 Contacts:
Diane Vazza, New York (1) 212-438-2760
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]