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Default, Transition, and Recovery: Emerging Market Defaults Are Higher Than In 2021

The 2022 global corporate default tally remains at 10, with no defaults since our last report on Feb. 24. The total also remains well below the 18 defaults during the same period in 2021.

Emerging markets is the only region where defaults so far in 2022 (four) are higher than the previous year (two) as risks in the region are increasing. The Russia-Ukraine conflict threatens to keep energy prices high, reinforcing price pressures from food, logistic charges, and persistent supply disruptions (see "What Higher Energy Prices Mean For Emerging Markets," March 3, 2022). The 12-month-trailing speculative-grade default rate increased in emerging markets in January to 1.9% from 1.8% as of Dec. 31, 2021.

This Week's Observations

  • The year-to-date global corporate default tally of 10 is at its lowest year-to-date level since 2014.
  • The U.S. region leads the tally with six, followed by the emerging markets with four, while Europe and the other developed region have no defaults so far in 2022 (see table 1).

Table 1

Both The U.S. And European Speculative-Grade Default Rates Decreased In January
Region 12-month-trailing speculative-grade default rate (%) 2022 YTD 2021 YTD 2021 Weakest links
U.S. 1.5 6 12 40 131
Emerging markets 1.9 4 2 15 18
Europe 1.7 0 4 14 49
Other developed 2.2 0 0 3 9
Global 1.6 10 18 72 207
Note: Trailing-12-month speculative grade default rates from Jan. 31, 2021–Jan. 31, 2022. Year-to-date data as of March 2, 2022. Weakest link data is 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

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Chart 2

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Table 2

Global Corporate Defaults Tally Remains At 10 So Far In 2022
Date Parent company Country/market Subsector To From Reason
1/4/2022 ION Geophysical Corp. U.S. Oil and gas D CCC Missed principal and interest payments
1/4/2022 Confidential Confidential Utilities D NR Confidential
1/13/2022

R&F Properties (HK) Co. Ltd.

Hong Kong Homebuilders/real estate companies SD CC Distressed exchange
1/19/2022 Confidential Confidential Homebuilders/real estate companies SD CCC- Confidential
1/24/2022

Fusion Connect Inc.

U.S. Telecommunications SD CC Distressed exchange
2/1/2022

Future Retail Ltd.

India Retail/restaurants SD CCC- Missed principal payments
2/1/2022

TPC Group Inc., (TPC Group LLC)

U.S. Chemicals, packaging, and environmental services D CCC Missed interest payments
2/9/2022 Confidential Confidential Retail/restaurants SD CCC Confidential
2/10/2022

Credito Real, S.A.B. de C.V., SOFOM, E.N.R.

Mexico Financial institutions SD CCC- Missed principal payments
2/17/2022

U.S. TelePacific Holdings Corp.

U.S. Telecommunications SD CCC- Distressed exchange
Data as of March 2, 2022. NR--Not rated. SD--Selective default. Sources: S&P Global Ratings Research and S&P Global Market Intelligence's CreditPro®.

Related Research

Default Studies

More analysis and statistics are available in our annual default studies, published on RatingsDirect:

Corporate (financial and nonfinancial)
Structured finance
U.S. public finance
Sovereign and international public finance

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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