Early warning signs of default accelerate for speculative-grade companies in EMEA
February 13th, 2020 (6 mins)
Sandra Veseli and Richard Morawetz discuss risks to nonfinancial corporate credit quality in EMEA. Excessive leverage and exposure to a cyclical downturn are among the early warning signs of potential default.
Early warning signs accelerate as the global economy decelerates
With defaults set to rise in EMEA, early warning signs exhibited by speculative-grade companies provide advance indicators of potential trouble ahead. Excessive leverage for a company’s rating and exposure to a cyclical downturn are the most prevalent signs, with both particularly pertinent in the context of slower economic growth.