Bangkok--16 Nov--Standard & Poor's
Standard & Poor's investment-grade composite spread remained unchanged yesterday at 223 basis points (bps), while its speculative-grade counterpart tightened marginally to 700 bps. By rating, the 'AA' spread expanded one basis point to 150 bps; 'A' and 'BBB' remained unchanged at 188 bps and 278 bps, respectively; 'BB' tightened one basis point to 506 bps; 'B' tightened 4 bps to 684 bps; and 'CCC' tightened 3 bps to 1,101 bps.
By industry, financial institutions and banks expanded one basis point each to 382 bps and 302 bps, respectively, and industrials tightened by the same increment to 360 bps. Utilities and telecommunications remained unchanged at 216 bps and 333 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.
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Mimi Barker, New York (1) 212-438-5054,
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