Capital Restructuring | Fourth Quarter 2014

February 2015 – Continuing a trend seen over the past few years, and unlike the bankruptcy cycles of (1) 2000-2003 and (2) 2008-2009, which were clearly dominated by certain sectors (telecom/technology and financial services, respectively), 2014’s Chapter 11 activity covered a wide range of industries including healthcare, oil & gas, retail and telecommunications. According to Moody’s and S&P, default rates finished the fourth quarter at 1.9% and 1.5%, respectively. Moody’s expects the default rate to rise to 2.8% in 2015, while S&P is projecting the U.S. corporate 12-month speculative-grade default rate to rise to 2.4% by September 30, 2015.

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