The 2022 global corporate default tally increased to 14 after Ukraine-based leading poultry meat producer and exporter of consumer goods MHP SE missed an interest payment. So far in 2022, the global corporate default tally is at its lowest year-to-date level since 2014; however, the pace of defaults has increased compared with the previous two quarters, which had 13 and 12 defaults, respectively (see chart 1).
By region, emerging markets now leads the global corporate default tally along with the U.S., with seven defaults each. This is the highest year-to-date default tally for emerging markets since 2015 and comes at a time when global financing conditions are tightening, inflation is rising, and the Russia-Ukraine conflict is generating significant market volatility--all of which could lead to additional credit stress for lower rated issuers (see "Credit Conditions Emerging Markets Q2 2022: Conflict Exacerbates Risks," March 29, 2022).
This Weeks Observations:
- The first quarter of 2022 reached its highest quarterly total since second-quarter 2021 as the default total increased to 14.
- All defaults year to date have been exclusively in the emerging markets or U.S. regions, with seven each.
- The emerging markets default rate at 1.8% remains below its five-year average, but risks in the region are rising.
- Globally, the consumer products and home builders/real estate sectors led the tally with three defaults each.
Table 1
Year-To-Date 2022 Global Defaults Increased To 14 | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Region | 12-month-trailing speculative-grade default rate (%) | YTD 2022 | YTD 2021 | 2021 | Weakest links | |||||||
U.S. | 1.5 | 7 | 15 | 40 | 121 | |||||||
Emerging market | 1.8 | 7 | 2 | 15 | 64 | |||||||
Europe | 1.2 | 0 | 8 | 14 | 61 | |||||||
Other developed | 2.2 | 0 | 1 | 3 | 10 | |||||||
Global | 1.5 | 14 | 26 | 72 | 256 | |||||||
Note: Trailing-12-month speculative-grade default rates from Feb. 28, 2021 – Feb. 28, 2022. YTD--Year-to-date data as of March 30. Weakest link data is as of Feb. 28, 2022. 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
Table 2
The Global Corporate Defaults Tally Reaches 14 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 | Consumer Products | SD | CCC- | Missed principal payments | ||||||||
2/1/2022 | TPC Group Inc. (TPC Group LLC) | U.S. | Health care | D | CCC | Missed interest payments | ||||||||
2/9/2022 | Confidential | Confidential | Consumer Products | 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 | ||||||||
2/11/2022 | Confidential | Confidential | Homebuilders/real estate companies | SD | CC | Confidential | ||||||||
2/17/2022 |
U.S. TelePacific Holdings Corp. |
U.S. | Telecommunications | SD | CCC- | Distressed exchange | ||||||||
3/15/2022 | Diamond Sports Group, LLC (Sinclair Broadcast Group Inc.) | U.S. | Media and Entertainment | SD | CC | Distressed exchange | ||||||||
3/21/2022 |
Mulhacen Pte. Ltd. |
Singapore | Financial Institutions | D | CC | Distressed exchange | ||||||||
3/24/2022 |
MHP SE |
Ukraine | Consumer Products | SD | B- | Missed interest payments | ||||||||
Data as of March 30, 2022. NR--Not rated. SD--Selective default. Sources: S&P Global Ratings Research and S&P Global Market Intelligence's CreditPro®. |
Related Research
- Ukraine-Based Farming Group MHP SE Downgraded To 'SD' On Missed Coupon Payment; Debt Ratings Lowered To 'D', March 24, 2022
Default Studies
More analysis and statistics are available in our annual default studies, published on RatingsDirect:
Corporate (financial and nonfinancial)
- 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
- 2020 Annual Mexican National Scale Corporate And Public Finance Default And 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
- 2020 Annual U.S. Public Finance Default And Rating Transition Study
- 2020 Annual International Public Finance Default And Rating Transition Study
- 2020 Annual Mexican National Scale Corporate And Public Finance Default And Rating Transition Study
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 |
Patrick Drury Byrne, Dublin (00353) 1 568 0605; patrick.drurybyrne@spglobal.com | |
Additional Contact: | Vaishali Singh, Pune; vaishali.singh2@spglobal.com |
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