Global company default risk rose in March: index

NEW YORK (Reuters) - The number of companies at an increased risk of defaulting on their debt globally jumped in March to its highest level so far this recession, with the most distressed companies seeing one of the largest increases.

Kamakura's index of "troubled" public companies increased 1.1 percentage point in March from February, to 24.3 percent of the global public company universe.

A company is considered "troubled" when its default probability is in excess of 1 percent. The index hit a high of 28 percent in September 2001.

Companies with the largest increase in short-term default risk included Blockbuster Inc (BBI.N), Fairpoint Communications FRP.N, Cumulus Media (CMLS.O), Gannett Co (GCI.N) and Eddie Bauer Holdings Inc EBHI.O, Kamakura said.

Companies with a default probability of more than 20 percent rose 0.4 percentage point to 3.1 percent in March, while companies with a 10-to-20 percent default risk rose 0.1 percentage point to 2.9 percent, the company said.

Companies with a 5-to-10 percent default risk rose 0.2 percentage point to 4.5 percent in the month, and companies with a 1-to-5 percent default probability increased 0.5 percent to 13.8 percent, Kamakura said.

(Reporting by Karen Brettell)