Bangkok--24 Sep--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade spreads tightened marginally yesterday, to 230 basis points (bps) and 738 bps, respectively. By rating, the 'AA' spread remained unchanged at 153 bps; 'A' tightened one basis point to 192 bps; 'BBB' tightened 2 bps to 294 bps; 'BB' and 'B' remained unchanged at 515 bps and 712 bps, respectively; and 'CCC' tightened 6 bps to 1,128 bps.
By industry, financial institutions, banks, and industrials tightened 2 bps each to 400 bps, 319 bps, and 383 bps, respectively, utilities tightened one basis point to 221 bps, and telecommunications remained unchanged at 325 bps.
Despite material tightening since their record highs in December 2008, the speculative-grade spread remains range-bound within 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