S&P: 2009 Ended with 265 Corporate Defaults
January 8, 2010
Global corporate bond defaults totaled 265 in 2009, with junk-rated companies comprising almost 90% of those that defaulted, according to a report issued today by Standard & Poor’s.
This is the highest annual number since S&P began tracking defaults in 1981, breaking the previous record of 229 defaults in 2001. The U.S. led the world with 193 defaults, roughly twice the number recorded for 2008.
Speculative-grade companies accounted for 87% of defaulting issuers, and a majority of the defaults were “weakest links,” with ratings of B- and lower.
Distressed exchanges were the leading cause of default, with a total of 103. Missed interest or principal payments was the second leading cause with 88 cases.
Four issuers—three U.S. companies and one Canadian company—have defaulted so far this year, according to S&P.
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