S&P: Credit-Quality Fallen Angels Hit a Record High
/FROM PR NEWSWIRE NEW YORK 800-776-8090/
TO BUSINESS EDITOR:
S&P: Credit-Quality Fallen Angels Hit a Record High
NEW YORK, Aug. 21 /PRNewswire/ -- As global credit quality continues to reside in the trough, the number of fallen angels hit a record high globally during the past 18 months.
Seventy-five issuers, with bonds outstanding totaling $75 billion, have fallen from investment grade to speculative grade during the past 18 months.
In 2000, there were 39 fallen angels totaling $35 billion. All but one, Nissan Motor Co. Ltd. ($6.2 billion), were U.S. issuers. By sector, there were 28 industrials ($22.0 billion), nine financial institutions ($10.4 billion), one utility ($2.3 billion) and one telecommunications company ($0.3 billion). The largest casualties were Nissan, FINOVA Group Inc. ($4.2 billion), Conseco Inc. ($4.2 billion), Service Corp. International ($2.6 billion), and Western Resources Inc. ($2.3 billion).
Year-to-date 2001, there have been 36 fallen angels totaling $40.0 billion. Of those, 22 ($33 billion) were U.S. issuers. The sovereign downgrade of Argentina accounted for 13 ($6.9 billion) of those outside the
U.S. By sector, there were 30 industrials ($22.7 billion), three financial institutions ($3.0 billion), two utilities ($14.1 billion) and one telecommunications company ($0.2 billion). The largest casualties at this point in 2001 are PG&E Corp. ($7.4 billion), Edison International ($6.7 billion), Lucent Technologies Inc. ($3.7 billion), Comdisco Inc. ($2.7 billion) and YPF Sociedad Anonima ($2.1 billion).
Currently, Standard & Poor's has 56 issuers globally that are rated 'BBB-' and are on CreditWatch with negative implications or are rated 'BBB-' and have a negative outlook. Of the 11 global issuers rated 'BBB-/Watch Neg',
seven are industrials, two are utilities, one is a financial institution, and one is a telecommunications company. Nine are U.S. issuers.
Of the 45 global issuers rated 'BBB-/Negative', 36 are industrials, six are financial institutions, two are utilities, and one is from the sovereign sector. Within the industrials sector, 18% are consumer products, 13% high
technology, and 11% media & entertainment. Twenty-nine are U.S. issuers.
'BBB-' Rated Issuers on CreditWatch with Negative Implications
Sector Subsector Issuer Country
FI Brokerage Kokusai Securities Co. Ltd. Japan
Indust. Aero&Defense Northrop Grumman Corp. U.S.
Indust. Forest&Building Potlatch Corp. U.S.
Indust. High Tech CommScope Inc. U.S.
Indust. High Tech Gateway Inc. U.S.
Indust. Media&Ent. Legacy Hotels Real Estate
Investment Trust
Canada
Indust. Media&Ent. Liberty Media Corp. U.S.
Indust. Media&Ent. Spherion Corp. U.S.
Telecoms Telecoms Hughes Electronics Corp. U.S.
Utility Electric Avista Corp. U.S.
Utility Electric Public Service Co. of
New Mexico
U.S.
'BBB-' Rated Issuers with Negative Outlooks
Sector Subsector Issuer Country
FI Bank Athlon Groep N.V. Netherlands
FI Bank Bank SinoPac Taiwan
FI Bank Commercial International Bank
(Egypt)
Egypt
FI Bank Farmers Bank of China Taiwan
FI Bank Holding Colonial BancGroup Inc. U.S.
FI Bank Holding Pacific Century Financial Corp U.S.
Indust. Aero&Defense Raytheon Co. U.S.
Indust. Automotive Dana Corp. U.S.
Indust. Automotive Navistar International Corp. U.S.
Indust. Cap. Goods Thomas & Betts Corp. U.S.
Indust. C-P&ES Pacific Dunlop Ltd. Australia
Indust. Cons. Prod. Briggs & Stratton Corp. U.S.
Indust. Cons. Prod. Dole Food Co. Inc. U.S.
Indust. Cons. Prod. Flowers Foods Inc. U.S.
Indust. Cons. Prod. Glanbia PLC Ireland
Indust. Cons. Prod. Interstate Bakeries Corp. U.S.
Indust. Cons. Prod. ServiceMaster Co. (The) U.S.
Indust. Cons. Prod. Smithfield Foods Inc. U.S.
Indust. Cons. Prod. Tommy Hilfiger, U.S.A. Inc. U.S.
Indust. Forest&Build Cemex S.A. de C.V. Mexico
Indust. Forest&Build Nichimen Corp. Japan
Indust. Forest&Build Rayonier Inc. U.S.
Indust. Health Care Bausch & Lomb Inc. U.S.
Indust. Health Care Quintiles Transnational Corp. U.S.
Indust. High Tech Chartered Semiconductor
Manufacturing
Singapore
Indust. High Tech Getronics N.V. Netherlands
Indust. High Tech IKON Office Solutions Inc. U.S.
Indust. High Tech Ingram Micro Inc. U.S.
Indust. High Tech Marconi PLC U.K.
Indust. High Tech Xerox Corp. U.S.
Indust. Media&Ent. American Greetings Corp. U.S.
Indust. Media&Ent. MGM Mirage U.S.
Indust. Media&Ent. News Corp. Ltd. Australia
Indust. Media&Ent. Rank Group PLC (The) U.K.
Indust. Media&Ent. Royal Caribbean Cruises Ltd. U.S.
Indust. Retail/Rest. Best Buy Co. Inc. U.S.
Indust. Retail/Rest. J.C. Penney Co., Inc. U.S.
Indust. Retail/Rest. Winn-Dixie Stores Inc. U.S.
Indust. Transport Airborne Inc. U.S.
Indust. Transport AMR Corp. U.S.
Indust. Transport Delta Air Lines Inc. U.S.
Indust. Transport National Rail Corp. Ltd. Australia
Sovereign Sovereign Egypt (Arab Republic of) Egypt
Utility Electric Hrvatska Elektroprivreda d.d. Croatia
Utility Gas & Water Southwest Gas Corp. U.S.
FI-Financial Institutions.
Aero&Defense-Aerospace & defense.
Indust.-Industrial.
C-P&ES-Chemicals Packaging & Environmental Services.
Cons. Prod.-Consumer Products.
Cap. Goods-Capital Goods.
Forest&Build-Forestry Products & Building Materials.
Media&Ent.-Media & Entertainment.
Retail/Rest.-Retail/Restaurants.
SOURCE Standard & Poor's
/CONTACT: Diane Vazza, New York, +1-212-438-2760, for Standard & Poor's/
/Web site: standardandpoors.com
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