Bangkok--23 Dec--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade composite spreads compressed yesterday to 200 basis points (bps) and 628 bps, respectively. By rating, the 'AA', 'A', and 'BBB' spreads tightened 2 bps each to 137 bps, 174 bps, and 254 bps, respectively. The 'BB' spread tightened 11 bps to 463 bps, 'B' tightened 13 bps to 631 bps, and 'CCC' tightened 14 bps to 1,004 bps.
Industry spreads also tightened across the board yesterday, with telecommunications compressing by the largest margin of 5 bps to 305 bps. Industrials tightened 4 bps to 323 bps. Financial institutions and banks compressed 2 bps each to 355 bps and 284 bps, respectively. Utilities tightened by the smallest increment of one basis point to 207 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,
[email protected]
Analyst Contact:
Diane Vazza, New York (1) 212-438-2760
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_
[email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]
Standard & Poor's