More NewsHigh Yield Debt Faces Greater Refinancing Risk in H2

High Yield Debt Faces Greater Refinancing Risk in H2

A total of $165 billion of US speculative-grade rated corporate bonds and bank debt is coming due over the next three years, Moody’s Investors Service said in its new annual study detailing refunding risk. Moody’s pointed to the second half of 2003 as a period of high activity and therefore possible risk, when $28 billion in debt faces refinancing versus only $17 billion in the first half of the year. At $100 billion, bank debt is the majority of the debt to be refinanced through 2005, mitigating risk somewhat as most is in the Ba grade, which is the higher end of the high yield spectrum. However, in the second half of 2003, $4.7 billion of the $28 billion coming due is rated below Ba3, Moody’s says, compared to $2.6 billion of below Ba3 debt coming due in the first half of the year. ‘Essentially, the second half of the year will be a larger challenge for refinancing given the risk that continued economic uncertainty will drive a flight to quality among investors,’ said Moody’s Vice President/Senior Analyst Paul Aran.

Related Articles

Preparing for GDPR? Here’s four things to consider

More News Preparing for GDPR? Here’s four things to consider

3m Elliott Wiseman
Cash flow in focus for investors

Cash Management Cash flow in focus for investors

4m Conor Deegan
Treasury TV: Karen Pugsley, Domino's Pizza Group

More News Treasury TV: Karen Pugsley, Domino's Pizza Group

4m Victoria Beckett
Treasury TV: Yeng Butler compares US and European MMF reforms

Compliance Treasury TV: Yeng Butler compares US and European MMF reforms

4m Victoria Beckett
Treasury TV: Tim de Knegt, The Port of Rotterdam

10 Minutes With The Treasury Treasury TV: Tim de Knegt, The Port of Rotterdam

5m Victoria Beckett
Banks are selling clients short with short dated cash deposit U-turns

Banking Banks are selling clients short with short dated cash deposit U-turns

5m Victoria Beckett
What does sterling’s Brexit boost mean for UK manufacturers?

More News What does sterling’s Brexit boost mean for UK manufacturers?

5m Tasja Botha
FX for corporates: 5 best practices for treasurers

Economy FX for corporates: 5 best practices for treasurers

5m Mateo Graziosi