(Editor's Note: Relevant calculations are based on issuer count rather than outstanding debt amount.)
Key Takeaways
- At 72, total defaults in 2021 were the lowest since 2014 while the fourth-quarter 2021 total of 12 defaults was the lowest since first-quarter 2014.
- The U.S. led defaults in 2021 with 40, followed by emerging markets with 15.
- By sector, homebuilders and real estate led the 2021 tally with 10 defaults, driven by an increase in defaults from China-based issuers.
- In 2021, 51% of defaults were related to distressed exchanges, up from 35% in 2020.
There were three additional defaults in 2021 following our last report on Dec. 9, 2021:
- Malaysia-based engineering and construction company Serba Dinamik Holdings Bhd.,
- China-based (Cayman Island incorporated) real estate company China Evergrande Group, and
- One confidential issuer.
The 2021 corporate default tally of 72 is the lowest since 2014--down nearly 70% from the previous year's total of 226 and significantly below its pre-pandemic 2019 levels (see table 1). The pace of defaults in 2021 slowed with each quarter, dropping to only 12 defaults in the fourth quarter (the lowest quarterly tally since 2014), from 26 defaults in the first quarter (see chart 1). Distressed exchanges accounted for the largest portion of corporate defaults in 2021 at 51% while the highest number of defaults were concentrated within the homebuilders and real estate sector at 10 (see charts 2 and 3). We estimate that the December 2021 12-month trailing speculative-grade default rates for the U.S and Europe will be 1.5% and 1.8%, respectively.
Table 1
The U.S. Leads 2021 Defaults With 40 Out Of 72 | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Region | 12-month trailing speculative-grade default rate (%) | 2021 | 2020 | 2019 | Weakest links | |||||||
U.S. | 1.5* | 40 | 146 | 78 | 135 | |||||||
Emerging market | 1.7 | 15 | 28 | 22 | 20 | |||||||
Europe | 1.8* | 14 | 42 | 15 | 50 | |||||||
Other developed | 2.2 | 3 | 10 | 3 | 11 | |||||||
Global | 1.8 | 72 | 226 | 119 | 216 | |||||||
*Trailing-12-month speculative-grade default rates from Nov. 30, 2020-Nov. 30, 2021 are preliminary and subject to change. Year-to-date data as of Jan. 5, 2022. Weakest link data as of Dec. 31, 2021. Other developed region includes Australia, Canada, Japan, and New Zealand. Default counts may include confidentially-rated issuers. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Chart 1
Chart 2
Chart 3
ION Geophysical Corp. Becomes The First Default Of 2022
2022 recorded its first default of the year as U.S.-based marine seismic data company ION Geophysical Corp. missed interest and principal payments on its 8% senior secured notes due 2025 and its 9.125% unsecured notes due 2020 (see "ION Geophysical Corp. Downgraded To 'D' On Missed Interest And Principal Payments," Jan. 4, 2021). This is ION's second default in the last 12 months, having previously defaulted in April 2021 after completing a debt exchange offer. Overall, we expect speculative-grade defaults to remain low through 2022, with default forecasts of 2.5% for both the U.S and Europe by September 2022 (see "The U.S. Speculative-Grade Corporate Default Rate Could Reach 2.5% By September 2022," Nov. 16, 2021 and "The European Speculative-Grade Corporate Default Rate Could Reach 2.5% By September 2022," Nov. 18, 2021).
Chart 4
Chart 5
Table 2
The 2021 Global Corporate Default Tally Increased To 72 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Parent company | Country | Subsector | To | From | Reason | ||||||||
1/5/2021 |
HGIM Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
1/6/2021 |
Promotora de Informaciones S.A. |
Spain | Media and entertainment | SD | CC | Distressed exchange | ||||||||
1/8/2021 |
Burger BossCo Intermediate Inc. |
U.S. | Retail/restaurants | SD | CCC | Distressed exchange | ||||||||
1/8/2021 |
Riverbed Parent Inc. (A) |
U.S. | High technology | SD | CC | Distressed exchange | ||||||||
1/21/2021 |
AMC Entertainment Holdings Inc. |
U.S. | Media and entertainment | SD | CC | Distressed exchange | ||||||||
1/25/2021 |
Awesome Acquisition Co. L.P. |
U.S. | Retail/restaurants | D | NR | Chapter 11 | ||||||||
1/25/2021 |
Alpha Media LLC |
U.S. | Media and entertainment | D | NR | Bankruptcy | ||||||||
1/27/2021 |
Imagine Group LLC (The) |
U.S. | Media and entertainment | D | CCC | Distressed exchange | ||||||||
2/2/2021 |
Belk Inc. |
U.S. | Retail/restaurants | D | CC | Missed interest payments | ||||||||
2/3/2021 |
Peabody Energy Corp. (A) |
U.S. | Metals, mining, and steel | SD | CC | Distressed exchange | ||||||||
2/3/2021 | Confidential | Confidential | Health care | SD | CCC- | Confidential | ||||||||
2/11/2021 |
Confidential |
Confidential | Automotive | D | CCC- | Confidential | ||||||||
2/11/2021 |
Vallourec |
France | Oil and gas | SD | CC | Missed principal payments | ||||||||
2/19/2021 |
Renfro Corp. |
U.S. | Consumer products | SD | CCC- | Distressed exchange | ||||||||
2/22/2021 |
CatLuxe Sarl (CatLuxe Acquistion Sarl) |
Luxembourg | Consumer products | SD | CCC+ | Distressed exchange | ||||||||
2/22/2021 |
Form Technologies LLC |
U.S. | Capital goods | SD | CC | Distressed exchange | ||||||||
2/26/2021 |
YPF S.A. |
Argentina | Oil and gas | SD | CC | Distressed exchange | ||||||||
3/2/2021 |
Sunshine 100 China Holdings Ltd. (A) |
Cayman Islands | Homebuilders/real estate companies | SD | CCC- | Distressed exchange | ||||||||
3/7/2021 | Confidential | Confidential | Financial institutions | D | NR | Confidential | ||||||||
3/8/2021 | Confidential | Confidential | Financial institutions | D | B+ | Confidential | ||||||||
3/16/2021 |
Ensign Drilling Inc. (Ensign Energy Services Inc.) |
Canada | Oil and gas | SD | CCC+ | Distressed exchange | ||||||||
3/16/2021 |
HighPoint Resources Corp. |
U.S. | Oil and gas | D | CC | Chapter 11 | ||||||||
3/17/2021 |
Washington Prime Group Inc. |
U.S. | Homebuilders/real estate companies | D | CC | Missed interest payments | ||||||||
3/18/2021 | Confidential | Confidential | Consumer products | D | CCC | Confidential | ||||||||
3/23/2021 |
AI Mistral Holdco Ltd. |
U.K. | Transportation | SD | CCC+ | Distressed exchange | ||||||||
3/26/2021 |
Avation PLC |
U.K. | Transportation | SD | CC | Distressed exchange | ||||||||
4/13/2021 |
YPF Energia Electrica S.A. (YPF S.A.) |
Argentina | Utilities | SD | CCC- | Distressed exchange | ||||||||
4/14/2021 |
ION Geophysical Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
4/15/2021 |
Summit Midstream Partners L.P. |
U.S. | Midstream | SD | CC | Distressed exchange | ||||||||
4/16/2021 |
Basic Energy Services Inc. |
U.S. | Oil and gas | D | CCC- | Missed interest payments | ||||||||
4/19/2021 |
Medical Depot Holdings Inc. |
U.S. | Health care | SD | CCC+ | Distressed exchange | ||||||||
4/19/2021 |
Serta Simmons Bedding LLC |
U.S. | Consumer products | SD | CC | Distressed exchange | ||||||||
4/23/2021 |
Isagenix Worldwide Inc. |
U.S. | Consumer products | SD | CCC | Distressed exchange | ||||||||
4/26/2021 | Confidential | Confidential | High technology | SD | CCC+ | Confidential | ||||||||
4/27/2021 |
Maxcom Telecomunicaciones S.A.B. de C.V. |
Mexico | Telecommunications | D | CCC- | Missed interest payments | ||||||||
4/28/2021 |
Future Retail Ltd. |
India | Retail/restaurants | SD | CCC- | Distressed exchange | ||||||||
4/28/2021 | Confidential | Confidential | Consumer products | SD | CCC- | Confidential | ||||||||
4/30/2021 |
Codere S.A. |
Spain | Media and entertainment | SD | CC | Distressed exchange | ||||||||
5/3/2021 | Confidential | Confidential | Transportation | D | CC | Confidential | ||||||||
5/10/2021 |
gategroup Holding AG |
Switzerland | Transportation | SD | CCC | Distressed exchange | ||||||||
5/10/2021 |
Voyager Aviation Holdings LLC |
U.S. | Transportation | SD | CC | Distressed exchange | ||||||||
5/14/2021 |
CDRH Parent Inc. |
U.S. | Health care | D | CC | Distressed exchange | ||||||||
5/19/2021 |
Boart Longyear Ltd. |
Australia | Metals, mining, and steel | D | CC | Bankruptcy | ||||||||
5/25/2021 | Confidential | Confidential | Homebuilders/real estate companies | D | CCC- | Confidential | ||||||||
6/3/2021 |
Peabody Energy Corp. (B) |
U.S. | Metals, mining, and steel | SD | CCC+ | Distressed exchange | ||||||||
6/23/2021 |
Carlson Travel Inc. |
U.S. | Media and entertainment | D | CCC | Missed interest payments | ||||||||
6/23/2021 | Confidential | Confidential | Consumer products | D | CCC- | Confidential | ||||||||
7/1/2021 |
GTT Communications Inc. |
U.S. | Telecommunications | SD | CCC- | Missed interest payments | ||||||||
7/8/2021 |
KCIBT Holdings L.P. |
U.S. | Consumer products | SD | CCC | Distressed exchange | ||||||||
7/9/2021 |
Joye Media SLU |
Spain | Media and entertainment | D | CCC- | Missed interest payments | ||||||||
7/12/2021 |
Peabody Energy Corp. (C) |
U.S. | Metals, mining, and steel | SD | CCC | Distressed exchange | ||||||||
7/13/2021 |
Sichuan Languang Development Co. Ltd. |
China | Homebuilders/real estate companies | D | CCC- | Missed bond repayment | ||||||||
7/20/2021 |
Alpha Holding S.A. de C.V. |
Mexico | Financial institutions | D | CC | Missed interest payments | ||||||||
7/30/2021 |
Comdata Spa |
Italy | Financial institutions | SD | CC | Distressed exchange | ||||||||
8/3/2021 | Confidential | Confidential | Transportation | SD | CC | Confidential | ||||||||
8/9/2021 |
Glass Mountain Pipeline LLC |
U.S. | Utilities | D | CC | Missed interest payments | ||||||||
8/11/2021 |
Sunshine 100 China Holdings Ltd. (B) |
Cayman Islands | Homebuilders/real estate companies | SD | CCC- | Missed bond repayment | ||||||||
8/13/2021 |
CLISA-Compania Latinoamericana de Infraestructura & Servicios S.A. |
Argentina | Capital goods | SD | CC | Distressed exchange | ||||||||
9/21/2021 | Array Canada Inc. | Canada | Consumer products | SD | CCC | Distressed exchange | ||||||||
9/29/2021 | Confidential | Confidential | Financial institutions | D | B- | Confidential | ||||||||
10/4/2021 |
IPC Corp. |
U.S. | Telecommunications | SD | CCC- | Distressed exchange | ||||||||
10/5/2021 |
Fantasia Holdings Group Co. Ltd. |
Cayman Islands | Homebuilders/real estate companies | SD | CCC | Missed bond repayment | ||||||||
10/15/2021 | Confidential | Confidential | Homebuilders/real estate companies | SD | CC | Confidential | ||||||||
10/19/2021 |
Sinic Holdings (Group) Co. Ltd. |
Cayman Islands | Homebuilders/real estate companies | SD | CC | Missed bond repayment | ||||||||
11/2/2021 |
Exela Technologies Inc. |
U.S. | Media and entertainment | SD | CCC- | Distressed exchange | ||||||||
11/11/2021 |
Investimentos e Participacoes em Infraestrutura S.A. - Invepar |
Brazil | Utility | D | CC | Distressed exchange | ||||||||
11/17/2021 |
Riverbed Parent Inc. (B) |
U.S. | High Technology | D | CC | Chapter 11 | ||||||||
12/6/2021 |
China Aoyuan Group Ltd. |
Cayman Islands | Homebuilders/real estate companies | SD | CCC | Missed principal payments | ||||||||
12/8/2021 | Confidential | Confidential | Capital goods | D | CCC+ | Confidential | ||||||||
12/9/2021 |
Serba Dinamik Holdings Bhd. |
Malaysia | Capital Goods | D | CC | Missed principal payments | ||||||||
12/17/2021 |
China Evergrande Group |
Cayman Islands | Homebuilders/real estate companies | SD | CC | Missed interest payments | ||||||||
12/19/2021 | Confidential | Confidential | Transportation | D | NR | Confidential | ||||||||
Data as of Jan. 6, 2022. (B) designation indicates the issuer's second default for 2021. (C) designation indicates the issuer's third default for 2021. *Sunshine 100 China Holdings Ltd., Fantasia Holdings Group Co. Ltd. and Sinic Holdings (Group) Co Ltd. are incorporated in the Cayman Islands but invest, develop, and manage real estate properties in the People’s Republic of China. Companies incorporated in the Cayman Islands are included in the U.S. default rate computation due to the location as a U.S. tax haven. NR--Not rated. SD--Selective default. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Table 3
The 2022 Global Corporate Default Tally Opened With 1 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Parent company | Country | Subsector | To | From | Reason | ||||||||
1/4/2022 |
ION Geophysical Corp. |
U.S. | Oil and gas | D | CCC | Missed principal and interest payments | ||||||||
Data as of Jan. 5, 2022. NR--Not rated. SD--Selective default. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Related Research
- ION Geophysical Corp. Downgraded To 'D' On Missed Interest And Principal Payments, Jan. 4, 2022.
- China Evergrande, Financing Arm Tianji Downgraded To 'SD' On Missed Coupon Payments; Ratings Withdrawn At Issuer Request, Dec. 17, 2021.
- China Aoyuan Downgraded To 'SD' On Nonpayment Of Borrowings; Ratings Withdrawn At The Company's Request, Dec. 6, 2021
- Global Credit Outlook 2022: Aftershocks, Future Shocks And Transitions, Nov. 30, 2021
- The European Speculative-Grade Corporate Default Rate Could Reach 2.5% By September 2022, Nov. 18, 2021.
- The U.S. Speculative-Grade Corporate Default Rate Could Reach 2.5% By September 2022, Nov. 16, 2021
Default Studies
More analysis and statistics are available in our annual default studies, published on RatingsDirect:
Corporate (financial and nonfinancial)
- 2020 Annual Mexican National Scale Corporate And Public Finance Default And Rating Transition Study
- 2020 Annual Global Leveraged Loan CLO Default And Rating Transition Study
- 2020 Annual Emerging And Frontier Markets Corporate Default And Rating Transition Study
- 2020 Annual Australia And New Zealand Corporate Default And Rating Transition Study
- 2020 Annual Infrastructure Default And Rating Transition Study
- 2020 Annual Global Financial Services Default And Rating Transition Study
- 2020 Annual Latin American Corporate Default And Rating Transition Study
- 2020 Annual Greater China Corporate Default And Rating Transition Study
- 2020 Annual European Corporate Default And Rating Transition Study
- 2020 Annual Asia Corporate Default And Rating Transition Study
- 2020 Annual Taiwan Ratings Corp. Corporate Default And Rating Transition Study
- 2020 Annual U.S. Corporate Default And Rating Transition Study
- 2020 Annual Global Corporate Default And Rating Transition Study
- 2020 Annual Japanese Issuer Credit Rating Transition Study
Structured finance
- 2020 Annual Mexican Structured Finance Default And Rating Transition Study
- 2020 Annual European Structured Finance Default And Rating Transition Study
- 2020 Annual Global Leveraged Loan CLO Default And Rating Transition Study
- 2020 Annual Taiwan Structured Finance Default And Rating Transition Study
- 2020 Annual Global Structured Finance Default And Rating Transition Study
- 2020 Annual Japanese Structured Finance Default And Rating Transition Study
U.S. public finance
Sovereign and international public finance
- 2020 Annual International Public Finance Default And Rating Transition Study
- 2020 Annual Sovereign Default And Rating Transition Study
This report does not constitute a rating action.
Credit Markets Research: | Nicole Serino, New York + 1 (212) 438 1396; nicole.serino@spglobal.com |
Secondary Contact: | Patrick Drury Byrne, Dublin (00353) 1 568 0605; patrick.drurybyrne@spglobal.com |
Research Contributor: | Yogesh Kumar, CRISIL Global Analytical Center, an S&P affiliate, Mumbai |
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