Bangkok--11 Sep--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade composite spreads tightened marginally yesterday to 241 basis points (bps) and 820 bps, respectively. By rating, the investment-grade spreads tightened one basis point each to 161 bps for 'AA', 202 bps for 'A', and 310 bps for 'BBB'. On the speculative-grade side, the 'BB' spread tightened 3 bps to 556 bps, 'B' tightened 7 bps to 784 bps, and 'CCC' tightened 10 bps to 1,298 bps.
By industry, industrials and telecommunications tightened 3 bps each to 416 bps and 341 bps, respectively, and financial institutions and banks tightened one basis point each to 434 bps and 356 bps, respectively. Utilities remained unchanged at 230 bps.
Despite material tightening since their all-time highs reached in December 2008, the speculative-grade spread remains near some of the highest levels ever recorded in a default cycle, and the investment-grade spread continues to face pressure from financial institutions and banks. In addition, speculative-grade defaults continue to accelerate, as does the preponderance of credit downgrades. Because of these factors, we expect spreads to remain at their elevated levels for some time as investors, the credit markets, and the economy cautiously tread through the current recessionary period.
Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contact:
Diane Vazza, New York (1) 212-438-2760
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