Bangkok--14 Dec--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade composite spreads tightened yesterday to 214 basis points (bps) and 668 bps, respectively. By rating, the 'AA' spread tightened one basis point to 146 bps, 'A' remained unchanged at 184 bps, 'BBB' tightened one basis point to 269 bps, 'BB' tightened 4 bps to 497 bps, 'B' tightened 7 bps to 667 bps, and 'CCC' tightened 6 bps to 1,052 bps.
Most of the industry spreads tightened. Banks compressed by the largest margin of 5 bps to 296 bps, followed by telecommunications, which tightened 3 bps to 324 bps. Financial institutions and industrials tightened 2 bps each to 372 bps and 343 bps, respectively, and utilities remained unchanged at 216 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:
Mimi Barker, New York (1) 212-438-5054,
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Analyst Contact:
Diane Vazza, New York (1) 212-438-2760
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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