RPT-Fitch: Emerging market issuers lift high yield default rate
Nov 25 (Reuters) - (The following statement was released by the rating agency)
A distressed debt exchange and a bankruptcy filing from two emerging market issuers helped boost the high yield default rate in October, according to Fitch Ratings.
The trailing 12-month default rate returned to 2% in October, propelled by a distressed debt exchange from China-based Winsway Coking Coal Holdings and filings from Brazilian oil company OGX Petroleo e Gas Participacoes SA and U.S.-based Savient Pharmaceuticals.
This year's default tally stands at $17.4 billion and the issuer count at 31 compared with $13.4 billion and 25 issuers in the first 10 months of 2012, respectively. OGX's bankruptcy (affecting $3.6 billion in bonds) was the largest default since Edison Mission's $3.7 billion default last December. There have been nine emerging market company defaults on $7.7 billion of dollar-denominated bonds this year versus five issuers and $2.9 billion for all of 2012.
The par weighted average recovery rate on 2013 defaults fell to 45.4% in October from 55.4% in September, mostly due to OGX whose bonds traded at a low 8.7% of par following default.
For full details please see 'Fitch U.S. High Yield Default Insight - Default Rate 2% in October' which is available at 'www.fitchratings.com' or by clicking on the link below.
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