Bangkok--8 Oct--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade composite spreads tightened yesterday to 236 basis points (bps) and 748 bps, respectively. By rating, the 'AA' and 'A' spreads tightened one basis point each to 159 bps and 197 bps, respectively. The 'BBB' spread tightened 2 bps to 295 bps; 'BB' and 'B' tightened 7 bps each to 525 bps and 716 bps, respectively; and 'CCC' tightened 3 bps to 1,157 bps.
Spreads tightened across industries as well, with banks tightening by the largest increment of 3 bps to 323 bps; industrials and telecommunications tightening 2 bps each to 386 bps and 335 bps, respectively; and financial institutions and utilities tightening one basis point each to 394 bps and 224 bps, respectively.
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:
Mimi Barker, New York (1) 212-438-5054, [email protected]
Analyst Contact:
Diane Vazza, New York (1) 212-438-2760
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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