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To: Les H who wrote (130003)	10/17/2001 11:59:27 PM
From: Les H	Read Replies (1) \| Respond to of 436258

Global bond issue default rate to hit 10% in ’01: S&P Our Bureau MUMBAI REFLECTING the global slump, global defaults on rated bond issuers continue to climb, Standard & Poor’s (S&P) said. Close to 121 rated global bond issuers have defaulted on $74.3-b debt since January against 108 issuers with rated debt of $34.3 b for full year ‘00. The default rate for ‘01 should hit 10 per cent, forecasts the agency. S&P has identified 50 of the weakest global rated issuers with rated bonds totalling $36 b in value. In the third quarter of calendar ‘01, there were 31 rated bond issuers defaulting on $19.6 b of rated debt. About 23 per cent of the number of defaults were in the telecommunications sector, followed by 13 per cent each in the capital goods and high technology sectors. Chemicals contributed 10 per cent of total defaults, while aerospace and defense accounted for six per cent each. Other contributors to the default list were consumer products, financial institutions, media and entertainment, metals, mining and steel. The largest default in the third quarter was US-based telecommunications major Exodus Communications Inc promoted by Indian-born KB Chandrasekhar. The company defaulted on $6-b debt. The largest default outside the US too was a telecommunications issuer, Telesystems International Wireless Inc, but for a much lower amount of $1.1 b. Year-to-date, the telecommunications sector accounts for 19 per cent of the number and 41 per cent of the volume, of defaulted bonds. Forest products account for nine per cent of the number, and 10 per cent of the volume; and financial institutions, three per cent of number and 10 per cent of volume of defaulted bonds. Around 76 per cent of the volume of defaults this year were bonds issued in the ‘97-’99 period, said a release. In those three years, $373 b of high-yield (sub investment grade) debt was issued. Twenty-five percent of this amounting to $93 b, was rated ‘B-’ or lower by S&P at the time of issue. Seventeen per cent of defaulting bonds were issued in 2000.