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Global Credit Research - 30 Jul 2012
New York, July 30, 2012 -- Despite the stressful environment since the onset of the global financial
crisis, the pace of sovereign defaults has remained moderate,
says Moody's Investors Service in its eighth annual sovereign bond
The report, "Sovereign Default and Recovery Rates, 1983-2012H1,"
highlights that from the over 110 Moody's-rated sovereigns,
Greece was the only one to default since the start of 2011. Jamaica
defaulted in 2010, there were no rated sovereign defaults in 2009,
and Ecuador defaulted in late 2008. Since 1983, all defaulters
were among the 25% lowest-rated sovereign issuers.
The global financial crisis has, however, continued to put
pressure on sovereign creditworthiness, increasing the share of
sovereign issuers in the lower tier of investment grade, says the
Moody's study. Nevertheless, the share of issuers rated
Aa and above is still substantially larger for sovereign issuers than
for corporate issuers.
A comparison between sovereign and corporate default rates by the rating
agency shows that sovereign default rates have generally been, on
average, modestly lower than those for corporates overall and by
like rating symbol. However, the differences are not likely
significant as the overall size of the sovereign sample is small.
Further, over the 1983-2012H1 period of study, sovereign
ratings have exhibited greater stability than their corporate counterparts.
The study presents an analysis of all sovereign defaults since 1983 and
compares and contrasts sovereigns and corporates with regard to default,
migration, and recovery rates as well as ratings accuracy measures.
Moody's subscribers can access the report at: http://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_144320.
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Group Credit Officer-Sovereign
Credit Policy Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
MD - Sovereign Risk
Financial Institutions Group
Moody's releases 2012 sovereign default study
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
No Related Data.
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