S&P: Recovery Rates in 2009 Below Average
February 25, 2010
Last year's recovery rates on defaulted securities were below the long-term average, according to a report published by Standard & Poor’s.
While recovery rates were extremely high from 2003 to 2007, the financial crisis had a big impact on 2009 recoveries. Recovery rates dropped to 39% from 74% for term loans and revolvers and to 34% from 51% for bonds, S&P analysts said.
“One of the key distinguishing characteristics of these issuers that emerged from default in late 2008 and 2009 is the dominance of distressed exchanges, which accounted for a much greater share of emergences than what we historically have observed,” said analysts.
S&P said the drop in recovery rates was in line with its expectations.
For more information on related topics, visit the following:
