Bangkok--3 Aug--Standard & Poor's
Globally, 18 companies--17 public and one confidentially rated--defaulted in the second quarter of 2010, said an article published today by Standard & Poor's, titled "Quarterly Default Update And Rating Transitions (Premium)."
The volume of rated debt affected by defaulters in the second quarter was $10.82 billion, with the U.S. accounting for more than 73%.
Of the 18 defaults in second-quarter 2010, 12 were domiciled in the U.S., three were from emerging markets, two were based in Europe, and one was from New Zealand. For more details, see "Second-Quarter 2010 Default Synopses (Premium)," also published today.
"Globally, the corporate default rate for speculative-grade-rated entities was 0.61% at the end of second-quarter 2010, compared with 0.97% in the first quarter of 2010 and 4.2% in second-quarter 2009," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "On a trailing-12-month basis, the global speculative-grade default rate as of June 2010 was 5.04%, down from 8.4% at the same time last year and a high of 9.9% in November 2009."
Although the default rate has declined, it is still higher than the long-term (1981 to June 2010) average of 4.4%.
"Overall credit quality, in our view, has started showing signs of stabilization relative to a year ago," said Ms. Vazza. "The number of downgrades has declined significantly across all regions--the downgrade-to-upgrade ratio fell to 0.95% in the second quarter of 2010 from 1.1% in the first quarter and 6.8% in second-quarter 2009."
This article is part of our premium Global Fixed Income Research content, which is available to premium subscribers to RatingsDirect on the Global Credit Portal at www.globalcreditportal.com and to RatingsDirect at www.ratingsdirect.com. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.
Media Contact:
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Analyst Contact:
Diane Vazza, New York (1) 212-438-2760