Bangkok--30 Dec--Standard & Poor's
Standard & Poor's investment-grade and speculative-grade composite spreads tightened marginally yesterday to 196 basis points (bps) and 610 bps, respectively. By rating, the 'AA' spread tightened 2 bps to 133 bps; 'A' and 'BBB' tightened one basis point each to 171 bps and 249 bps, respectively; 'BB' and 'B' tightened 4 bps each to 446 bps and 607 bps, respectively; and 'CCC' remained unchanged at 987 bps.
By industry, financial institutions, industrials, and telecommunications tightened by the largest margin of 2 bps each to 349 bps, 316 bps, and 295 bps, respectively. Banks followed, tightening one basis point to 280 bps. Utilities remained unchanged at 204 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