S&P: Global Fallen Angels: Potential Rises.Business Editors NEW YORK--(BUSINESS WIRE)--Standard & Poor's Aug. 13, 2002--According to a new Standard & Poor's report, "fallen angels"-issuers whose credit ratings fall to double-'B'-plus and below from triple-'B'-minus and above, moving into the speculative-grade rating category from the investment-grade investment-grade Of, relating to, or being a bond suitable for purchase by institutions under the prudent man rule. Investment-grade is restricted to those bonds graded BBB and above by Standard & Poor's and graded Baa3 and above by Moody's. rating category-are flourishing flour·ish v. flour·ished, flour·ish·ing, flour·ish·es v.intr. 1. To grow well or luxuriantly; thrive: The crops flourished in the rich soil. 2. under the "soft" economic recovery and questionable accounting practices. Globally, the annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. 2002 number of fallen angels-currently at 50-will rival the 57 of 2001, possibly continuing the six-year trend of increasing fallen angels. In terms of dollar volume globally, 2002 with more than US$122 billion affected, has already exceeded 2001's volume. The U.S. has contributed 30 fallen angels this year, affecting US$95.5 billion. In the near term, the potential number of fallen angels globally could remain high with outlooks and CreditWatch implications on global corporate ratings 30% negative, 61% stable, 1% developing, and only 7% positive. To date, Standard & Poor's has identified 72 issuers around the globe that have fallen angel potential, three more than identified two months earlier. "The aerospace & defense, brokerage, capital goods Capital Goods Any goods used by an organization to produce other goods. Notes: Examples of capital goods include office buildings, equipment, and machinery. See also: Capital Expenditure, Disinvestment Capital goods , and media & entertainment subsectors have the cloudiest forecasts, each with more than 40% of issuers within their subsector having either a negative outlook or a CreditWatch with negative implications," said Diane DIANE Diversified Information and Assistance Network (Tennessee Valley Authority) DIANE Direct Information Access Network for Europe DIANE Digital Integrated Attack and Navigation Equipment Vazza, head of Global Fixed Income Research. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. , 50 issuers with bonds outstanding totaling US$122 billion have fallen to speculative-grade from investment-grade. In contrast, 24 issuers, with bonds totaling US$35.4 billion, have risen to investment-grade from speculative-grade. In the past 15 1/2 years, there have been 438 (US$509 billion) fallen angels and 428 (US$343 billion) rising stars. Of the 50 fallen angels this year, 30 were in the U.S., five in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , two each in Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. and Ireland Ireland, Irish Eire (âr`ə) [to it are related the poetic Erin and perhaps the Latin Hibernia], island, 32,598 sq mi (84,429 sq km), second largest of the British Isles. , and one each in Bermuda Bermuda (bûrmy  `də), British dependency (2005 est. pop. 65,400), 21 sq mi (53 sq km), comprising some 150 coral rocks, islets, and islands (of which some 20 are inhabited), in the ,
Egypt Egypt (ē`jĭpt), Arab. Misr, biblical Mizraim, officially Arab Republic of Egypt, republic (2005 est. pop. 77,506,000), 386,659 sq mi (1,001,449 sq km), NE Africa and SW Asia. , France, Guam Guam (gwäm), Chamorro Guåhan, the largest, most populous, and southernmost of the Mariana Islands (see also Northern Mariana Islands, an unincorporated territory of the United States (2005 est. pop. , Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. , Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. , Netherlands, Philippines, Spain,
Sweden, and Uruguay. By sector, there were 29 industrial (US$38.8
billion), nine utilities (US$34.2 billion), four telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. (US$48.7 billion), four financial institutions (US$0.4 billion), one
infrastructure finance (US$250), and three sovereigns. The largest were
WorldCom The former name of MCI. Based in Jackson, MS, WorldCom, Inc. was a major, international telecommunications carrier. It was founded in 1983 by Bernard Ebbers as Long Distance Discount Service (LDDS), a reseller of AT&T WATS lines to small businesses. Inc. (US$30.0 billion), Williams Companies The Williams Companies, Inc. (NYSE: WMB) is an energy company based in Tulsa, Oklahoma. Its core business is natural gas exploration, production, processing, and transportation, with additional petroleum and electricity generation assets. Inc. (US$13.0), and
Qwest Communications
Currently, Standard & Poor's has 72 issuers globally that are rated triple-'B'-minus and are on CreditWatch with negative implications or are rated triple-'B'-minus and have a negative outlook. This rating designation and CreditWatch/rating outlook is the lowest in the investment-grade category. Four of the global issuers rated 'BBB-/Watch Neg' are industrial, two utilities, and one financial institution. Two are U.S. issuers, with one each from Bermuda, Canada, France, Germany, and Taiwan. Of the 65 global issuers rated 'BBB-/Negative', 49 are industrials, nine financial institutions, four utilities, and three banking. Within the industrials sector, nine are media & entertainment, seven are consumer products, and five each in capital goods, chemicals, packaging & environmental services The various combinations of scientific, technical, and advisory activities (including modification processes, i.e., the influence of manmade and natural factors) required to acquire, produce, and supply information on the past, present, and future states of space, atmospheric, , high technology, and retail/restaurants. Furthermore, there are three each in forest products & building materials Building materials used in the construction industry to create . These categories of materials and products are used by and construction project managers to specify the materials and methods used for . and health care, two each in automotive and transportation, one each in aerospace & defense, homebuilders/real estate co. and metals, mining & steel. Forty-six are U.S. issuers, four Japanese, three Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. , two each from Bermuda and Singapore, and one each from Croatia, Hong Kong, Ireland, Mexico, Netherlands, Panama, Tunisia, and the U.K. Since Standard & Poor's last commentary on fallen angels (June 17), 18 issuers have been downgraded to speculative-grade. No potential fallen angel issuers had rating upgrades.
'BBB-' Rated Issuers on CreditWatch with Negative Implications:
Sector Subsector Issuer Country
Fin. Instit. Insurance Union Insurance Co. Ltd. Taiwan
Industrial Forest&Build Dyckerhoff AG Germany
Industrial Forest&Build Tyco International Ltd. Bermuda
Industrial Media&Ent Vivendi Universal S.A. France
Industrial Retail/Rest Winn-Dixie Stores Inc. U.S.
Utility Utility AltaGas Services Inc Canada
Utility Utility Reliant Resources Inc. U.S.
'BBB-' Rated Issuers with Negative Outlooks:
Sector Subsector Issuer Country
Banking Bank Athlon Groep N.V. Netherlands
Banking Bank Banco Latinoamericano De
Exportaciones S.A. Panama
Banking Bank Provident Financial Group, Inc U.S.
Fin Inst Fin Inst Desc, S.A. de C.V. Mexico
Fin Inst Insurance American Steamship Owners Mutual
P & I Assn Inc. U.S.
Fin Inst Insurance Annuity & Life Re (Hldgs) Ltd. Bermuda
Fin Inst Insurance B.E.S.T. Reinsurance Co. Tunisia
Fin Inst Insurance Markel Corp. U.S.
Fin Inst Insurance Nisshin Fire & Marine
Insurance Co. Ltd. Japan
Fin Inst Insurance PMA Capital Corp. U.S.
Fin Inst Insurance Tenet Insurance Co. Ltd. Singapore
Fin Inst Insurance White Mountains Insurance
Group Ltd. Bermuda
Industrial Aero& Def AAR Corp. U.S.
Industrial Automotive ArvinMeritor Inc. U.S.
Industrial Automotive Cummins Inc. U.S.
Industrial Cap.Goods Komatsu Ltd. Japan
Industrial Cap.Goods Thomas & Betts Corp. U.S.
Industrial Cap.Goods Toshiba Corp. Japan
Industrial Cap.Goods Trinity Industries Inc. U.S.
Industrial Cap.Goods Victor Co. of Japan Ltd.
(JVC Corp.) Japan
Industrial CP&ES Crompton Corp. U.S.
Industrial CP&ES Ferro Corp. U.S.
Industrial CP&ES Millennium Chemicals Inc. U.S.
Industrial CP&ES NOVA Chemicals Corp. Canada
Industrial CP&ES PolyOne Corp. U.S.
Industrial Cons.Prod. ARAMARK Corp. U.S.
Industrial Cons.Prod. Corn Products International Inc. U.S.
Industrial Cons.Prod. Flowers Foods Inc. U.S.
Industrial Cons.Prod. Glanbia PLC Ireland
Industrial Cons.Prod. Interstate Bakeries Corp. U.S.
Industrial Cons.Prod. Smithfield Foods Inc. U.S.
Industrial Cons.Prod. Tommy Hilfiger, U.S.A. Inc. U.S.
Industrial Forest&Build Abitibi-Consolidated Inc. Canada
Industrial Forest&Build Georgia-Pacific Corp. U.S.
Industrial Forest&Build Potlatch Corp. U.S.
Industrial Health Care Bausch & Lomb Inc. U.S.
Industrial Health Care Group Health Cooperative of
Puget Sound U.S.
Industrial Health Care Quintiles Transnational Corp. U.S.
Industrial High Tech Agilent Technologies Inc. U.S.
Industrial High Tech Amdocs Ltd. U.S.
Industrial High Tech Anixter International Inc. U.S.
Industrial High Tech Chartered Semiconductor Mfg. Ltd. Singapore
Industrial High Tech PerkinElmer Inc. U.S.
Industrial Home/Real Kerry Properties Ltd. Hong Kong
Industrial Media&Ent American Greetings Corp. U.S.
Industrial Media&Ent Belo Corp. U.S.
Industrial Media&Ent Clear Channel Communications Inc. U.S.
Industrial Media&Ent Four Seasons Hotels Inc. Canada
Industrial Media&Ent Hearst-Argyle Television Inc. U.S.
Industrial Media&Ent Hilton Hotels Corp. U.S.
Industrial Media&Ent MGM Mirage U.S.
Industrial Media&Ent Park Place Entertainment Corp. U.S.
Industrial Media&Ent Starwood Hotels & Resorts
Worldwide Inc. U.S.
Industrial MM&S Phelps Dodge Corp. U.S.
Industrial Retail/Rest Best Buy Co. Inc. U.S.
Industrial Retail/Rest Big Lots Inc. U.S.
Industrial Retail/Rest J.C. Penney Co., Inc. U.S.
Industrial Retail/Rest Payless ShoeSource Inc. U.S.
Industrial Retail/Rest Zale Corp. U.S.
Industrial Transport Airborne Inc. U.S.
Industrial Transport British Airways PLC U.K.
Utility Utility Hrvatska Elektroprivreda d.d. Croatia
Utility Utility Limestone Electron Trust U.S.
Utility Utility Puget Energy Inc. U.S.
Utility Utility Southwest Gas Corp. U.S.
Aero&Def-Aerospace & Defense, Cap.Goods-Capital Goods, Cons.prod-Consumer products, CP&ES-Chemicals, packaging & environmental services, FI-Financial Institutions, Forest&Build-Forest products & building materials, High Tech-High technology, Home/Real-Homebuilders/real estate, Media&Ent-Media & entertainment, MM&S-Metals, mining & steel, Oil & Gas-Oil & gas exploration & production, Retail/Rest-Retail/restaurants, Transport-Transportation. Copyright 2002, Standard & Poor's Ratings Services Ratings Service A company, such as Moody's or Standard & Poor's, that rates various debt and preferred stock issues for safety of payment of principal, interest, or dividends. |
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