Bangkok--16 Aug--Standard & Poor's
The number of global weakest links has continued to drop throughout 2010, said an article published today by Standard & Poor's, titled "Global Bond Markets' Weakest Links And Monthly Default Rates (Premium)." Weakest links totaled 133 as of Aug. 10, down from 141 in July and 278 a year ago.
Weakest links are issuers rated 'B-' and lower with a negative outlook or ratings on CreditWatch negative. The 133 weakest links have combined rated debt worth $146.07 billion.
"The U.S. leads in the number of weakest links, with 93, or 69%, of the 133 entities," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research. "By sector, media and entertainment, oil and gas exploration and production, banks, and finance companies were the most vulnerable, with the highest concentrations of weakest links."
The 12-month-trailing global corporate speculative-grade default rate fell to 4.51% in July 2010 from 5.05% in June--its eighth consecutive monthly decline. Regionally, the U.S. speculative-grade corporate default rate also decreased for the eighth consecutive time, to 5.48% in July from 5.94% in June. In Europe, the default rate declined to 3.74% from 6.01%, while the emerging markets default rate increased to 1.93% from 1.77%.
"Companies rated 'B-' and lower have a notable amount of debt coming due over the next four years," said Ms. Vazza. "In the U.S., for instance, approximately $235 billion in 'B-' and lower rated debt is maturing among nonfinancial issuers between 2011 and 2014."
The standard version of this article is part of our standard Global Fixed Income Research content. The premium version contains expanded analysis of the article's most significant points, typically broken out by sector and region. Also in the premium version are in-depth charts and tables, the underlying data of which are available for download. 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:
Mimi Barker, New York (1) 212-438-5054,
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Analyst Contact:
Diane Vazza, New York (1) 212-438-2760