The default rate of the S&P/LSTA Leveraged Loan Index inched to 1.37% by principal amount, from 1.33% at the end of January, after Noranda Aluminum filed for Chapter 11 on Feb. 8.

Citing challenging market conditions for the aluminum industry Noranda filed for Chapter 11 in the U.S. Bankruptcy Court for the Eastern District of Missouri.

Though not a large default—there was about $467 million outstanding under Noranda’s TLB as of Sept. 30, SEC filings show—Noranda is the fifth S&P/LSTA Index issuer to default this year, following defaults from The Sports Authority,Verso/NewPage, Arch Coal and RCS Capital in January.

The loan default rate is expected to remain below trend in 2016, before creeping up to the historical average of 3.2% by the end of 2017. Indeed, managers on average say that the loan default rate by amount will climb to 2.35% by year-end 2016 and to 3.24% by year-end 2017, according to LCD’s latest quarterly buyside survey conducted in early December. – Kerry Kantin/Steve Miller

This story first appeared on www.lcdcomps.com, LCD’s subscription site offering complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.