NEW YORK (Standard & Poor’s) July 27, 2015–Standard & Poor’s Ratings Services downgraded 244 issuers worth $1.2 trillion in rated debt and upgraded 125 issuers with $621 billion in rated debt in the second quarter of 2015.
Downgrades eclipsed upgrades around the world as geopolitical and economic risks rose, including Greece’s potential exit from the eurozone (the “Grexit”), a slowdown in economic growth in China, and the credit effect from interest rate normalization on part of the Federal Reserve System in the U.S., according to Standard & Poor’s “Global Corporate And Sovereign Rating Actions And Outlook–Downgrades Surpass Upgrades Around The World As Geopolitical And Economic Risks Increase,” published today on RatingsDirect.
“Downgrades surpassed upgrades across the globe in the second quarter of 2015, with most regions seeing two downgrades for every one upgrade—slightly above historical averages,” said Diane Vazza, head of Standard & Poor’s Global Fixed Income Research Group. “Europe was the lone exception, where downgrades still exceeded upgrades, but at a tighter margin of 1.7 to 1; the three downgrades of Greece (Hellenic Republic) in the second quarter boosted Europe’s share of downgraded debt to account for nearly two-thirds of the global total.” Under Standard & Poor’s policies, only a Rating Committee can determine a Credit Rating Action (including a Credit Rating change, affirmation or withdrawal, Rating Outlook change, or CreditWatch action). This commentary and its subject matter have not been the subject of Rating Committee action and should not be interpreted as a change to, or affirmation of, a Credit Rating or Rating Outlook.