U.S. High Yield Default Insight

U.S. High Yield Default Insight

The U.S. high yield par default rate continues to track closely to the 2012 year-end rate of 1.9%, At the end of February, it slipped modestly to 1.8% (mostly due to the market's larger size), and we project a similar level for the first quarter. March has added filings from gaming operator Revel AC, Inc. and phone directory publisher, Dex Media, and two missed interest payments from oil and gas company GMX Resources and healthcare concern Rotech. These add an estimated $1.5 billion to the year's default tally of $2.8 billion through February. An update of default, recovery rates and other metrics can be found by clicking on the report link below.

Fitch Ratings

U.S. High Yield Default Loss Rate Below 1% in 2012

U.S. High Yield Default Loss Rate Below 1% in 2012

For the third consecutive year, the U.S. high yield default rate remained well below average, ending 2012 at 1.9% and up just modestly from 1.5% in 2011. The average recovery rate on the year’s defaults was 50.2% and the median recovery, 38.9%. Both measures slipped from 2011’s more robust 59.4% average and 47.9% median.

US Shale Not a Threat to Stable EMEA Oil and Gas Outlook

13 Dec 2012 10:18 AM
US Shale Not a Threat to Stable EMEA Oil and Gas Outlook

Link to Fitch Ratings' Report: 2013 Outlook: EMEA Oil and Gas

Fitch Ratings-London-13 December 2012: Cheap US shale gas is not a material threat to the EMEA oil and gas sector in 2013, Fitch Ratings says. A lack of US export infrastructure, a political desire for the US to be self-sufficient in gas, and the prevalence of long-term oil-based gas supply contracts in Europe all suggest at worst modest downward pressure on European prices in the short to medium term.

Tesco US Exit Would End Losses, Allow UK Turnaround Focus

Fitchratings.com
05 Dec 2012 11:35 AM
Tesco US Exit Would End Losses, Allow UK Turnaround Focus

Fitch Ratings-London-05 December 2012: A withdrawal from the US would benefit Tesco's financial profile by halting several more years of operating losses and would allow the retailer to focus on addressing more pressing issues in its home market, Fitch Ratings says. Early expectations for growth from the US business quickly proved over-optimistic, especially as it was launched just before the economic downturn. Still a withdrawal would leave the group's European and Asian operations as the only source of international diversification.

Natural Gas Liquid Prices Pressuring Midstream Profits

03 Oct 2012 12:25 PM
Natural Gas Liquid Prices Pressuring Midstream Profits

Fitch Ratings-New York-03 October 2012: With supply continuing to outstrip demand, low prices on natural gas liquids (NGLs) are weighing on midstream processors' profitability. Fitch Ratings believes slowing NGL demand and lingering price weakness is likely to pressure profitability throughout the balance of 2012 and into 2013.

CRE Losses Moderating for U.S. Financial Institutions

27 Sep 2012 4:08 PM
CRE Losses Moderating for U.S. Financial Institutions

Fitch Ratings-Chicago-27 September 2012: Four years after U.S. financial institutions' commercial real estate (CRE) loan portfolios began to come under extreme pressure during the credit crisis, moderate improvements in CRE loan loss performance are supporting steady but slow asset quality recovery for most U.S. financial institutions rated by Fitch. The trend is positive and reflects a view that the recovery in CRE will not be as financially painful as Fitch had previously expected, although the return to normalized levels of performance and growth may be more prolonged.