U.S. middle market (MM) issuance was flat in 2023, according to a new Fitch Ratings report. The report, which incorporates data from Fitch’s LevFin Insights, shows that issuance was $36.5 billion in 2023, compared to $36.7 billion in 2022, and down...
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February 05, 2024, 08:02 AM
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Nearly three quarters of North American sectors maintain a deteriorating outlook for 2023, reflecting Fitch Ratings’ expectation for weaker core credit drivers relative to 2022. Inflation, rising rates, and tightening lending conditions remain key...
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July 03, 2023, 08:09 AM
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While the recent and sudden deterioration of several U.S. banks has been most impactful to the depositors, shareholders and lenders to these institutions, non-bank financial institutions, insurance companies and funds have experienced a variety of...
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March 16, 2023, 07:55 AM
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The build-up of macro risk for global credit is the core theme of Fitch Ratings’ 2023 outlook reports. We expect risks related to sustained above-average inflation, supply constraints and tightening monetary conditions will crystallize this year...
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January 06, 2023, 07:35 AM
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Business development companies (BDCs) have periodically evolved since their creation in the late 1980s, with the advent of perpetual non-traded BDCs being the most recent example, Fitch Ratings says. Continuous fundraising in perpetual non-traded...
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June 10, 2022, 07:49 AM
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A decrease in first-lien term loan recoveries, driven by the pandemic, has begun to reverse, with 2021 ultimate recoveries reverting back to historical levels, according to a new Fitch Ratings report.“The coronavirus pandemic, resulting EBITDA...
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March 28, 2022, 07:00 AM
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Global financial institutions’ (FIs) credit ratings have been affected less severely by the pandemic than by the two previous crises this century, Fitch Ratings says. The agency’s transition and default analysis shows that global FI ratings fell by 0...
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November 17, 2021, 07:40 AM
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Revolving credit facilities remained a critical tool for companies, with overall robust recoveries for both asset-backed loans (ABL) and cash flow revolvers, according to a new Fitch Ratings report."The pandemic fostered increased revolving credit...
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July 23, 2021, 08:08 AM
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The 2021 institutional U.S. loan default rate forecast has been lowered to 1.5% from 2.5%, reflecting continued capital market confidence as constricted sectors re-open, according to a new Fitch Ratings report."The anticipated 1.5% default rate would...
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June 22, 2021, 08:05 AM
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The 2021 institutional loan default rate forecast has been lowered to 2.5% from 4.5%, according to a new Fitch Ratings report."Operating conditions are starting to improve due to the ramp-up in coronavirus vaccinations and the easing of restrictions...
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April 27, 2021, 08:10 AM
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The March trailing 12-month institutional leveraged loan default rate stands at 3.9%, according to a new Fitch Ratings report."The current 2021 forecast is 4.5%, but if market access remains as open and issuer-friendly as it has been, the rate will...
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March 24, 2021, 08:00 AM
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Rating Outlooks have turned Negative for many non-bank financial institution (NBFI) sub-sectors compared to the start of 2020, reflecting negative pressures from the operating environment on asset quality, earnings and support-driven ratings, says...
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January 06, 2021, 08:30 AM
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Widespread vaccine availability later in 2021 will alleviate pressures on global structured finance (SF) asset performance by reducing the duration of the pandemic and likelihood of lockdown measures, mitigating downside risk in 2H21, Fitch Ratings...
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December 16, 2020, 09:05 AM
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The growing trend of mergers among rated business development companies (BDCs) has generally improved portfolio diversification, increased first-lien exposures, built asset coverage cushions through lower leverage and should broaden funding profiles...
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December 02, 2020, 08:44 AM
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Financial institutions will be exposed to long-lasting economic scars from the coronavirus pandemic, which could affect ratings in the longer term, Fitch Ratings says. This is likely to be negative for the credit profiles of most banks and for US...
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November 30, 2020, 09:10 AM
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The average net loss for portfolios of U.S. broadly syndicated loan (BSL) CLOs under Fitch's surveillance steadied in October at -1.4%, even while 2020 vintages reduced their average net gain, Fitch shows in its latest Monthly U.S. CLO Index. The...
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November 19, 2020, 07:30 AM
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The expiration of forbearance programs will lead to increased delinquencies in the absence of further government stimulus, Fitch Ratings says. The impact of forbearance measures on asset performance is explored in Fitch's new report Coronavirus...
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November 13, 2020, 08:37 AM
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Bankrupt healthcare and food, beverage and consumer companies' relatively high reorganization multiples and stable cash flow profiles promoted mostly strong recoveries at the first-lien level, according to a new Fitch Ratings report."Healthcare and...
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November 04, 2020, 09:10 AM
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After an unprecedented pause due to the coronavirus pandemic, the sports world has changed but is back to delivering content, according to Fitch Ratings. Liquidity options have supported resumption of play and enabled leagues to conduct games in...
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October 23, 2020, 08:20 AM
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Fitch Ratings’ sector outlook for business development companies (BDCs) is worsening for 2021, driven by the expectation for weaker asset quality metrics and the potential for valuation volatility as a result of the challenging economic backdrop...
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October 21, 2020, 09:05 AM
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Fitch Ratings has published its updated criteria for CLOs and corporate CDOs. At the same time, Fitch has published a feedback report, detailing responses received in respect of the exposure draft for the criteria report.The final criteria removed...
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October 16, 2020, 08:00 AM
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The January 2021 launch of fallbacks for derivative contracts that reference Libor will still make it challenging for the industry to adopt new term rates referencing the Secured Overnight Financing Rate (SOFR) before Libor ceases to be quoted at end...
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October 13, 2020, 09:00 AM
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Amid the fallout from the coronavirus-induced global pandemic, banks in North America will continue to face a challenging operating environment throughout the medium term, Fitch Ratings says. Industry trends within North America that were emerging...
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October 12, 2020, 09:05 AM
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The resurgence of the pandemic, restrictions at borders and the absence of business trips will delay recovery for the European lodging sector despite the better-than-expected summer season, Fitch Ratings says in its new report. Room rates as well as...
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October 08, 2020, 09:00 AM
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Alternative investment managers (Alt-IMs) are seeing various unexpected benefits as a result of the economic fallout of the coronavirus pandemic, with the outlook for interest rates in most major economies remaining low through 2023 expected to fuel...
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October 01, 2020, 08:40 AM
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Widespread upward revisions of US corporate sector-level post-lockdown recovery assumptions that would lead to mass rating actions post-2Q20 results are unlikely, given the cautious outlook on the pace of economic activity and sector fundamentals...
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September 28, 2020, 09:05 AM
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The TTM U.S. institutional term loan default rate is expected to finish higher for the ninth consecutive month, potentially reaching 4.6% from 4.3% at the end of August, according to a new Fitch Ratings report."September volume registers a modest $1...
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September 21, 2020, 09:15 AM
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U.S. high yield default activity produced a modest $2.8 billion of volume since the end of July, the lowest level since the start of the coronavirus pandemic, according to a new Fitch Ratings report."The TTM default rate stands at 5.7%, up from 2.9%...
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September 15, 2020, 08:00 AM
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Most U.S. broadly syndicated loan (BSL) collateralized loan obligations (CLOs) under Fitch Ratings' surveillance showed stable or improving portfolio metrics in August compared with July, as rating pressure on underlying loan issuers eased and LIBOR...
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September 14, 2020, 09:10 AM
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New CMBS delinquencies for July 2020 totaled 283 loans ($8.05 billion) for a total of 871 ($20.1 billion) compared to 673 loans ($13.7 billion) as of June 30, 2020; some loans that were delinquent in June became current again in July. Hotel loans...
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August 26, 2020, 08:54 AM
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U.S. high yield defaults tally just $0.7 billion so far in August, a significant decline from the $12.8 billion monthly average over the past four months, according to a new Fitch Ratings report."August default volume could reach nearly $3 billion...
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August 21, 2020, 09:10 AM
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Fitch Ratings' new interactive country-by-country map of bank rating trends shows that the balance of Outlooks globally has turned sharply negative since the onset of the coronavirus pandemic. The proportion of bank ratings on Negative Outlook or...
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August 10, 2020, 09:05 AM
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The continued deterioration in credit quality of issuers due to the coronavirus pandemic resulted in a large number of U.S. middle market (MM) CLOs failing a variety of tests for the first time in 2Q20, according to Fitch Ratings' latest U.S. MM CLO...
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August 04, 2020, 08:55 AM
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Fitch Ratings' review of nearly 180 global non-bank financial institutions (NBFIs) since March in response to the coronavirus pandemic found balance-sheet intensive business models face greater pressure in 2020 than more balance-sheet light...
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July 28, 2020, 09:00 AM
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The coronavirus pandemic is having a leveraging effect on North American corporates due to reduced cash flow and increased debt issuance to shore up liquidity during the outbreak, says Fitch Ratings:"Under our baseline scenario deleveraging to...
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June 19, 2020, 09:15 AM
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Canadian banks took massive provisions in 2Q20, and earnings plummeted 50.1% year-over-year given rapid deterioration in banks' economic outlooks due to the coronavirus pandemic, disrupting 2020 operating plans, according to a new report from Fitch...
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June 18, 2020, 09:20 AM
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The U.S. high yield default rate is poised to reach 5% in June for the first time since July 2016, up from 4.6% at May 31 driven by energy defaults, according to a new Fitch Ratings report."Default volume tallied a heavy $32.7 billion over the past...
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June 12, 2020, 09:15 AM
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US non-financial corporations issued a record $584 billion of investment-grade bonds through May, more than double the amount registered over the same time frame one-year prior. Bonds have been issued at meaningfully lower average rates, which should...
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June 10, 2020, 09:05 AM
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The recent bankruptcy filings of Hertz and Advantage Rent A Car could further exacerbate the downward pressure on U.S. used vehicle prices for the remainder of the year and pressure lease residual values and recovery rates on defaulted auto loans...
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June 04, 2020, 09:10 AM
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Negative rating actions across global structured finance (SF) from the coronavirus pandemic will be distributed more broadly and are expected to be less severe in most sectors than experienced by the worst performing areas during the period from 2008...
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May 29, 2020, 09:25 AM
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New loan delinquencies and new loan transfers to special servicing within the Fitch-rated U.S. CMBS conduit universe increased substantially in May due to coronavirus. The majority of conduit remittances for May have now been reported and 30-day loan...
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May 21, 2020, 09:10 AM
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The coronavirus pandemic is causing sharp economic contraction and a rapid spike in unemployment that will lead to significant performance degradation in U.S. Marketplace Loan (MPL) portfolios and potentially imperil the viability of some MPL...
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May 12, 2020, 08:00 AM
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While the vast majority of the largest U.S. banks reported positive earnings in 1Q20, profitability will become more challenging going forward as the impact of the coronavirus pandemic sets in, according to Fitch Ratings latest U.S. Banking Quarterly...
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May 11, 2020, 09:10 AM
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The coronavirus-triggered downturn is pushing default rates higher and is also affecting the bankruptcy procedures used to address such credit defaults, according to Fitch Ratings.Several recent debtors have had their bankruptcy cases derailed as...
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May 06, 2020, 09:16 AM
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Global Quantitative Easing (QE) asset purchases are likely to reach USD6 trillion in 2020, Fitch Ratings says. Central banks' balance sheets are expanding extremely rapidly as they buy up large quantities of public and private assets and increase...
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April 27, 2020, 09:15 AM
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Fitch Ratings expects U.S. CMBS loan delinquencies to approach peak levels, with hotel and retail expected to have the highest delinquency rates.Although the delinquency rate has been steadily declining, and was 1.31% as of March 2020, it will now...
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April 20, 2020, 09:15 AM
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The full impact of the coronavirus outbreak, and its expected lengthy, economically painful aftermath, are impossible to predict. Fitch Ratings' corporate group has collated a series of assumptions for 2021 that convey Fitch's current estimate of the...
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April 16, 2020, 09:15 AM
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LIBOR floors in US leveraged loan agreements can provide some cushion to US CLOs, which is supportive to credit when benchmark rates drop as seen during the current market turmoil linked to the coronavirus pandemic, Fitch Ratings says. Leveraged...
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April 03, 2020, 09:30 AM
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The U.S. sovereign rating is supported by structural strengths that include the size of the economy, high per capita income and a dynamic business environment. The U.S. benefits from issuing the U.S. dollar, the world's pre-eminent reserve currency...
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March 30, 2020, 09:10 AM
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Coronavirus' rapidly increasing effect on air travel is placing downward pressure on global airline credit profiles, especially as there are risks that demand takes materially longer than previous shocks to recover, says Fitch Ratings. Most...
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March 16, 2020, 09:10 AM
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The transition from U.S. dollar (USD) London Interbank Offered Rate (Libor) to its likely replacement, the Secured Overnight Funding Rate (SOFR), presents heightened risks for U.S. financial institutions (FIs), Fitch Ratings says. Banks may face...
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February 20, 2020, 09:10 AM
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The gulf between market share gainers and donors is widening, as weaker retailers lack the means to improve positioning, often leading to bankruptcy, according to a new Fitch Ratings report."Filers were challenged by weak operating trends, an...
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January 28, 2020, 09:05 AM
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Bank rating Outlooks are still skewed to the negative, although less so than six months' ago, Fitch Ratings says. The global share of Negative Outlooks was 13% at end-2019 and the share of Positive Outlooks 5%, compared with 17% and 6%, respectively...
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January 24, 2020, 09:05 AM
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Potential credit risk may emerge for US leveraged loans if the base rate on loans converts to a higher Prime Rate when the London Inter-Bank Offered Rate (LIBOR) is discontinued post 2021, says Fitch Ratings. Issuers could experience deterioration in...
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January 14, 2020, 09:10 AM
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Fitch Ratings expects the U.S. institutional leveraged loan default rate to climb to 3% in 2020, while the 2020 high yield default rate is expected to reach 3.5%, according to a new Fitch Ratings report."Growing outstanding amounts on our Lists of...
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December 27, 2019, 09:00 AM
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The Fed has recently stepped in to ameliorate repo market volatility; however, the structural issues leading U.S. banks to hoard cash seems likely to persist, according to a new dashboard report from Fitch Ratings. This may continue to present...
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December 18, 2019, 09:00 AM
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Global banks are increasingly embedding environmental, social and governance (ESG) factors into their risk-management frameworks, Fitch Ratings says in a new report. More than half the 182 banks that took part in Fitch's ESG survey said they...
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December 09, 2019, 09:55 AM
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The ratings and sector outlooks for U.S. banks, while stable, reflect the weakening economic operating environment evidenced by a flat yield curve and declining business confidence, as well as the effects of the Fed's loose monetary policy and a...
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November 26, 2019, 08:59 AM
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The federal government's two primary tools to stimulate the economy, fiscal and monetary policy, may be constrained relative to previous cycles, potentially exacerbating cyclical US public finance (USPF) funding deficits and delaying the rebuilding...
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November 22, 2019, 08:00 AM
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Regulatory change is the most likely near-term event risk for US corporate business models and financial profiles, particularly in the healthcare & pharmaceuticals; real estate; and gaming, lodging & leisure sectors, says Fitch Ratings.Strategic M&A...
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November 18, 2019, 08:50 AM
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Business development companies (BDCs) will face continued challenges heading into 2020, including competitive underwriting conditions, earnings pressure from lower interest rates and unsustainable asset quality metrics, according to Fitch Ratings'...
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October 30, 2019, 09:00 AM
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Low borrowing costs have helped to temper political concerns over rising federal budget deficits and debt in recent years. However, Fitch Ratings believes that public finances could emerge as a greater issue for U.S. policymakers in the event that...
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September 25, 2019, 08:50 AM
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Low borrowing costs have helped to temper political concerns over rising federal budget deficits and debt in recent years. However, Fitch Ratings believes that public finances could emerge as a greater issue for U.S. policymakers in the event that...
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September 20, 2019, 08:55 AM
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Annual GDP growth rates have been falling since mid-2018 in virtually all of the 20 large developed and emerging economies covered in Fitch Ratings' 20/20 Vision macro data chart pack. This underscores the drag on activity from the sharp global...
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September 03, 2019, 09:00 AM
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U.S. natural gas producer hedge positions should help mitigate cash flow risk and support credit profiles as Henry Hub spot prices languish but some exploration and production (E&P) companies may need to adjust capital allocation and make capital...
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August 30, 2019, 08:30 AM
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The shift in the direction of global monetary policy in the last six months has been more broad-based across geographies than in any period since 2009, with more than a third of central banks covered in the Bank for International Settlements' (BIS)...
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August 19, 2019, 08:50 AM
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Financial institutions' leveraged loan and CLO exposures are manageable relative to sector capital but risks may rise sharply in a stress, Fitch Ratings says in a new report. Undrawn facilities may be called on leading up to or during a leveraged...
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August 15, 2019, 09:00 AM
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The London Stock Exchange's (LSE) proposed acquisition of Refinitiv reflects increased M&A interest in data and analytics due to the increasing strategic value of data layers to customers and the margin and cash flow benefits of subscription-based...
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August 07, 2019, 09:00 AM
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While U.S. core ABS performance remains strong due largely to low unemployment, many investors are zeroing in their questions on some of the sector's non-core assets, according to Fitch Ratings in its 2019 Virtual Investor Video Series for structured...
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July 24, 2019, 08:40 AM
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The Federal Reserve is likely to cut interest rates by less than financial markets expect over the rest of 2019 given robust jobs growth in the US, Fitch Ratings says. A 25bp cut now appears probable at either the July or September FOMC meeting but...
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July 18, 2019, 08:55 AM
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The energy sector will lead U.S. high yield default volume for the third consecutive month following Weatherford International Public Ltd's bankruptcy, according to the latest High Yield Default Insight report from Fitch Ratings.The July trailing...
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July 15, 2019, 08:45 AM
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U.S. banks are expected to report lower sequential net interest margins (NIM) during the second-quarter 2019 earnings season as the Treasury yield curve has notably flattened, according to the latest dashboard report from Fitch Ratings. The Federal...
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July 02, 2019, 09:00 AM
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The trade war is weighing on investment prospects and has sharply increased downside risks to world economic growth forecasts, Fitch Ratings says in its new Global Economic Outlook (GEO)."Even though our base case assumes that further US tariffs on...
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June 20, 2019, 09:00 AM
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A 2% high yield default rate is projected for YE 2020 on a record low 12% 'CCC' share of issues and only 5% of outstandings due before 2021, according to a new Fitch Ratings report.The forecast assumes continued economic growth but caveats that...
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June 17, 2019, 09:15 AM
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The recent slowdown in M&A and LBO-related loan issuance volumes is providing an opportunity for sponsors and arrangers to launch dividend recapitalization (recaps) transactions intended to normalize returns on investments, according to Fitch Ratings...
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May 29, 2019, 09:00 AM
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With an increase of 18%, M&A advisory was the only business to report a year-over-year gain in the first quarter of 2019 for the five U.S. global trade and universal banks (GTUBs), according to the latest U.S. Capital Markets Quarterly report from...
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May 02, 2019, 09:15 AM
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The Federal Reserve's dovish stance on keeping the Fed Funds rate at its current level for the remainder of 2019 will pressure U.S. banks' revenue. However, the rate pause may also prolong the benign credit quality environment, according to Fitch...
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March 22, 2019, 08:11 AM
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Coworking providers have established a sustainable position in key global office markets, due to a fundamental and generational shift in office demand trends, and are benefiting the US office REIT sector, according to Fitch Ratings. WeWork, one of...
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March 14, 2019, 08:00 AM
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The significant rise in low investment-grade U.S. corporate debt may not equate to greater fallen angel risk in the next downturn, according to Fitch Ratings. Some of the rise is due to M&A accompanied by EBITDA growth and some is attributed to...
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January 29, 2019, 09:00 AM
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The outlook for global growth has been dented by a series of recent weak data releases, but not dismantled, said Fitch Ratings in new report. The broad contours of the agency's December 2018 Global Economic Outlook (GEO) forecasts for 2019 - with...
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January 18, 2019, 07:24 AM
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Credit risks across many sectors are rising with a looming cyclical deterioration in credit conditions and global debt at near-record levels, says Fitch Ratings. However, the macroeconomic conditions and the sector breakdown of leverage in developed...
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January 11, 2019, 09:00 AM
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The risk of an imminent U.S. recession remains low despite the recent flattening of the U.S. yield curve, Fitch Ratings says. The underlying recession signals traditionally embodied by a yield curve inversion, namely high policy interest rates...
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December 14, 2018, 09:00 AM
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The stable sector outlook for global investment managers (IMs) in 2019 reflects growing scale and product diversity, which should provide a degree of cushion against multiple sector headwinds, Fitch Ratings says. However, traditional IMs may be more...
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December 10, 2018, 07:11 AM
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A quarter of companies making a major acquisition were downgraded, or placed on Rating Watch Negative or Negative Outlook immediately after the deal's announcement, based on our analysis of rating trends following 200 major transactions over five...
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October 16, 2018, 08:09 AM
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The Alternatives Reference Rates Committee's (ARRC) suggestions for addressing the discontinuation of LIBOR leave some risk to borrowers and lenders with respect to loan repricing, according to Fitch Ratings.As anticipated, the ARRC has recently...
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October 10, 2018, 08:01 AM
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Mergers and aquisitions (M&A) activity is widespread across the U.S. fintech industry, with deal sizes increasing meaningfully, according to a new report from Fitch Ratings.
The industry is absorbing more than $25 billion of deal activity YTD. Fitch...
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August 13, 2018, 08:07 AM
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The time a U.S. company spends in bankruptcy has shrunk considerably, according to a new Fitch Ratings bankruptcy case study report."The compressed timeframe is benefitting creditors, minimizing employee and trade union uncertainty, and lessening...
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August 08, 2018, 08:01 AM
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Bankruptcies remain a rare occurrence for companies in the Aerospace & Defense (A&D) and Industrial & Manufacturing (I&M) sectors, according to a new report published by Fitch Ratings.High-yield bond default rates for A&D and I&M companies averaged 1...
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August 06, 2018, 07:12 AM
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Despite U.S. healthcare defaults at a 16-year low, profits of some issuers are challenged, according to a new Fitch Ratings report."Payor consolidation and increasing scrutiny of both high cost drugs and care delivery settings are hurting healthcare...
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July 03, 2018, 08:00 AM
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A reliance on spread revenue and narrow business models can present a credit challenge for banks concentrated in commercial real estate (CRE) lending relative to more diversified regional banking peers, Fitch Ratings says. Interest rate risk from...
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June 11, 2018, 07:18 AM
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As the credit cycle enters its late stage, key metrics are stronger than before the start of prior recessions, pointing towards a lower expected default rate in the near term, according to a new Fitch Ratings report."We're seeing better trends when...
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June 05, 2018, 07:10 AM
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New financial reform legislation easing the Dodd-Frank Act (DFA) for smaller and custodial banks is not likely to be a near-term ratings issue but could be negative for some banks' credit profiles over the long term, if it results in significantly...
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May 25, 2018, 08:00 AM
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Additional Business Development Companies (BDCs) are likely to seek board and/or shareholder approval to increase leverage to 2.0x from 1.0x following recent changes from the Small Business Credit Availability Act, which was signed into law on March...
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April 16, 2018, 07:08 AM
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The effect of Toys 'R' Us' announcement that it will close all 735 of its stores on CMBS transaction TRU Trust 2016-TOYS is a prime example of how retail pressures can affect credit outcomes and how CMBS transactions can avoid risks, says Fitch...
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April 12, 2018, 08:00 AM
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The largest U.S. banks are keeping their exposure to the beleaguered retail sector in check, according to Fitch Ratings. The retail sector is unlikely to threaten the banks' ratings given their limited exposure, strong core earnings and healthy...
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November 14, 2017, 07:44 AM
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Capital markets net revenues were down for all five U.S. global trading and universal banks (GTUBs) in the second quarter, both sequentially and year over year (YOY), following a generally strong start to the year, according to Fitch Ratings in its...
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September 14, 2017, 07:11 AM
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Increased issuance of asset-backed securities (ABS) by U.S. banks and nonbank financial institutions (NBFIs) could affect some issuers' credit profiles if it leads to a sustained increase in secured wholesale funding sources, says Fitch Ratings....
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August 09, 2017, 07:17 AM
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As the diversified industrial and capital goods sectors begin to recover, there are a number of risks to credit improvement, according to Fitch Ratings. These include mergers and acquisitions, activist investors, shareholder-friendly actions, and the...
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July 14, 2017, 07:49 AM
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A significant proportion of U.S. non-bank financial institutions (NBFIs) would be adversely affected by an accelerated and higher-than-anticipated increase in US interest rates, says Fitch Ratings. The impact on U.S. NBFIs of US interest rates...
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April 12, 2017, 07:25 AM
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Donald Trump's presidential victory, in combination with Republicans maintaining control of Congress, reinforces the central role that legislative and regulatory event risk play for certain segments of the US corporate healthcare industry, according...
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November 10, 2016, 07:53 AM
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Secular challenges including the rise of e-commerce and discount retailers, declining mall traffic, and consumer spending shifts toward services and experiences have created a highly competitive retail environment that has placed some retailers at...
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September 29, 2016, 07:17 AM
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The run-up in business development company (BDC) equity prices in recent months should lead to further opportunistic equity issuance by some BDCs, says Fitch Ratings. For those firms trading above net asset value (NAV) and able to access equity...
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September 21, 2016, 07:27 AM
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U.S. Financial Bond issuance declined for all sectors except insurance in the first half of 2016, according to a new Fitch Ratings report. The first half of 2016 closed with net new issuance at $56 billion, annualizing to a 7% growth rate and 16%...
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August 18, 2016, 07:14 AM
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The FASB's new standard on accounting for credit losses on financial instruments will affect US banks' reserving practices, says Fitch Ratings. However, it will be manageable as banks have adequate time to prepare for implementation.The new standard...
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July 21, 2016, 07:38 AM
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Fitch Ratings has affirmed the 'BB' Long-Term Issuer Default Rating (IDR) and debt ratings of Fifth Street Finance Corp (FSC). The Rating Outlook is Negative. Fitch has chosen to withdraw the ratings of FSC for commercial reasons. A full list of...
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June 08, 2016, 07:29 AM
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Fitch Ratings has affirmed Ares Capital Corporation's (Ares) Long-Term Issuer Default Rating (IDR) and secured and unsecured debt ratings at 'BBB' following the announced acquisition of American Capital, Ltd. (ACAS). The Rating Outlook is Stable. The...
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May 24, 2016, 07:01 AM
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First-quarter business development company (BDC) earnings reports showed some improvement in portfolio valuations but also underscored the broader challenges facing the sector, says Fitch Ratings. Capital constraints, low market volumes and risks of...
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May 23, 2016, 08:01 AM
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99 Cents Only Stores LLC's (99 Cents Only) near-term liquidity should remain adequate in fiscal 2017 (January) given significantly reduced inventory, further lowering of capex and Fitch Ratings' expectation that the company's gross margin will expand...
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May 02, 2016, 07:57 AM
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Despite the varied strategies and risk appetites of business development companies (BDCs), one consistent trend across the sector is increasing leverage, according to a new report from Fitch Ratings on the 18 largest BDCs. Against the current market...
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April 26, 2016, 08:14 AM
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Wells Fargo & Company (WFC) reported $5.5 billion in net income for a return on assets (ROA) of 1.21%, down 2% on a linked-quarter basis and down 6% from a year ago, according to Fitch Ratings. Earnings were impacted by an expected energy-related...
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April 15, 2016, 07:46 AM
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Fitch Ratings believes asset quality for business development companies (BDCs) could deteriorate further in 2016 following challenging energy performance in 2015, according to Fitch's latest North American Financial Institutions Chart of the Month....
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March 21, 2016, 08:16 AM
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The trailing 12-month (TTM) energy default rate is expected to finish February above 9% while the exploration and production (E&P) rate will surpass 14%, as continued declines in commodity prices are helping to push U.S. high-yield bond issuers in...
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February 22, 2016, 07:33 AM
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Activist investors are increasingly campaigning against U.S. financial institutions (FIs), a move driven by changes in the activists' approach and an increased alignment with regulatory objectives, according to Fitch Ratings.While traditionally...
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February 08, 2016, 07:29 AM
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Fitch's latest stress tests of BDCs focus on leverage ratios under downside scenarios to energy-related investments broadly, and oil & gas exposures specifically. The tests include a partial writedown of oil & gas-related investments, a partial...
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January 22, 2016, 07:56 AM
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An expected Chapter 11 bankruptcy filing by Verso Corp. would boost the mid-January trailing 12-month (TTM) high yield bond default rate to 3.7% from 3.4% at year-end 2015, according to Fitch Ratings. A filing would affect approximately $2.7 billion...
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January 21, 2016, 07:21 AM
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Recent leveraged loan price volatility presents increased risks and opportunities for CLO managers, Fitch Ratings says. Managers in volatile markets are challenged to make credit calls that may significantly affect long-term performance for CLO...
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December 29, 2015, 07:33 AM
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Asset quality reversion, growing regulatory scrutiny and profitability pressures are among the challenges facing finance and leasing companies (FLCs) globally in the coming year, supporting Fitch Ratings' negative sector outlook for 2016.The Rating...
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December 04, 2015, 07:11 AM
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A total of $2 billion of loan defaults in November led by Millennium Health LLC pushes the trailing 12-month (TTM) default rate to 1.7% from 1.5% at the end of October, according to Fitch Ratings. Millennium's $1.8 billion Chapter 11 filing on Nov....
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November 25, 2015, 07:38 AM
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Energy and metals/mining defaults continued unabated midway through the fourth quarter, placing continued pressure on the U.S. high yield default rate, according to Fitch Ratings. Five energy companies either completed distressed debt exchanges...
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November 16, 2015, 07:42 AM
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U.S. coal producers continue to restructure as challenges in the sector mount, according to Fitch Ratings. The trailing 12-month default rate for the industry was 27.7%, including Hidili Industry International Development Ltd., Alpha Natural...
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November 10, 2015, 07:19 AM
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The announcement by CIT Group Inc. that John A. Thain will retire as Chief Executive Officer (CEO) at the end of first-quarter 2016, following the announcement earlier this week that CIT's Chief Financial Officer (CFO) Scott T. Parker will depart the...
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October 23, 2015, 07:51 AM
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For the first time since the financial crisis, business development companies (BDCs) are facing a relatively significant near-term maturity wall, as $1.3 billion of convertible notes and other debt issued by Fitch-rated BDCs in 2011 and 2012 are...
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October 19, 2015, 07:50 AM
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After five issuer defaults already this month accounting for nearly $2 billion in new volume, Fitch Ratings now expects the US high-yield default rate to end 2015 at around 3.5% -- above the 2.9% trailing 12- month (TTM) rate through September. This...
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October 12, 2015, 07:23 AM
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Chinese banks, especially mid-tier lenders, are likely to continue facing profitability and capitalisation pressures in the near term, says Fitch Ratings. Fitch expects that the macroeconomic slowdown will continue to result in weakening asset...
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September 08, 2015, 07:31 AM
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Hercules Offshore, Inc.'s prepackaged bankruptcy filed last week may be a leading indicator of further bankruptcies among other challenged high yield (HY) offshore drillers, according to Fitch Ratings.Hercules' restructuring plan involves the...
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August 17, 2015, 07:28 AM
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As underwriting conditions remain relatively competitive, the slowdown in growth is positive, yet is also a result of multiple challenges to the industry. As leverage levels have trended higher in recent years, BDCs have grown, but with little...
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June 01, 2015, 07:57 AM
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Fitch Ratings does not anticipate any current impact to Ares Capital Corporation's (Ares Capital) 'BBB' ratings resulting from General Electric Corporation's (GE) announcement that it plans to divest the majority of General Electric Capital...
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April 15, 2015, 07:12 AM
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Fitch Ratings has assigned a 'BBB-/RR1' rating to Staples, Inc.'s new credit facilities, composed of a $3 billion five-year asset based lending (ABL) revolver and a $2.75 billion six-year secured term loan. Fitch currently rates Staples' Long-term...
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April 13, 2015, 08:00 AM
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In 2014 global structured finance upgrades exceeded downgrades for the first time since the financial crisis, Fitch Ratings says. 12% of ratings improved while 7% were downgraded. The 'AAAsf' level exhibited the most stability, as almost 99% of...
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March 17, 2015, 07:00 AM
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Fitch Ratings noted the Mar. 5 release of the Dodd-Frank Act Stress Test (DFAST) results showed all 31 U.S. bank holding companies passing minimum capital ratio requirements, demonstrating very modest improvements in projected loan losses and mostly...
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March 09, 2015, 08:04 AM
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Fitch Ratings has downgraded the Long-term Issuer Default Rating (IDR) for RadioShack Corporation (RadioShack) to 'D' from 'C' following the company's announcement that it has filed Chapter 11. Fitch has also affirmed the 'CCC-/RR2' rating on...
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February 09, 2015, 07:15 AM
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Second-lien energy loans account for 23% of the total outstanding $40 billion, the highest percentage of any sector and well above the 8% overall market figure at the end of 2014, according to Fitch Ratings.The high price of oil and, importantly, the...
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February 04, 2015, 07:23 AM
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U.S. banks with higher exposures to the energy sector should withstand the recent declines in energy prices over the near-term, says Fitch Ratings. The ultimate impact will be driven by the duration and severity of price declines, as well as the...
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January 19, 2015, 07:46 AM
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Accelerating loan growth accompanied by eased underwriting is a leading concern for U.S. banks in the Office of the Comptroller of the Currency's (OCC) semiannual Risk Perspective Report released in late December. The report, a review of key risks...
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December 30, 2014, 08:12 AM
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Fitch expects U.S. sales growth to modestly improve in the coming holiday season, with retail sales (ex auto) expected to grow at 3%-4% in November/December versus 2.8% year to date. The National Retail Federation is forecasting that November and...
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November 26, 2014, 07:14 AM
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RadioShack Corporation announced that Standard General LP and certain other investors have replaced GE Capital as the lead lender under RadioShack's $585 million senior secured asset based lending (ABL) credit facility (which included a $50 million...
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October 07, 2014, 07:26 AM
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Business development companies (BDCs) are increasingly using off balance sheet investment vehicles called senior secured loan programs (SSLPs) to increase their effective portfolio leverage without running afoul of regulatory limits on balance sheet...
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September 23, 2014, 08:03 AM
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Fitch Ratings has assigned issuer and expected issue level ratings related to Burger King Worldwide, Inc.'s (Burger King; NYSE: BKW) proposed acquisition of Tim Hortons, Inc. The debt is being issued by 1011778 B.C. Unlimited Liability Company...
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September 19, 2014, 07:09 AM
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A shift by U.S. banks to increase the proportion of securities classified as held-to-maturity (HTM) likely signals an attempt to reduce capital volatility, especially during periods of rising interest rates, according to Fitch Ratings. Banks will...
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March 19, 2014, 07:51 AM
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The removal of business development companies (BDCs) from the S&P and Russell indices will likely reduce the liquidity of their shares and increase their cost to raise equity in the near-term, according to Fitch. The removals involved 33 BDCs...
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March 14, 2014, 07:43 AM
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Two potential bankruptcies are a warning sign of financial distress among restaurant chains, according to Fitch Ratings. Fitch does not view them as portending a widespread increase in bankruptcies of U.S. restaurants but a reflection of difficulties...
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March 10, 2014, 07:37 AM
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RadioShack's weak operating results are expected to further constrain its liquidity in 2014, leaving the company with a limited window of opportunity to turn around its business, according to Fitch Ratings.
On March 4, 2014, the company reported a...
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March 07, 2014, 07:45 AM
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Smaller U.S. banks with assets of less than $10 billion are stepping up M&A activity at a time when weak organic growth prospects and rising regulatory costs are driving a need for increasing scale, according to Fitch Ratings. Fitch believes that...
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February 24, 2014, 07:17 AM
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Widening in J.C. Penney's (JCP) five-year credit default swap (CDS) spreads underscores continued investor concern, according to Fitch Solutions. The retailer said last week it would close 33 stores nationwide and cut 2,000 jobs as it struggles to...
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January 21, 2014, 07:04 AM
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Fitch Ratings has affirmed its 'CCC' Long-term Issuer Default Rating (IDR) on RadioShack Corporation (RadioShack). Fitch has also assigned ratings to the company's new credit facilities.
Key Rating Drivers:The IDR reflects the significant decline in...
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December 24, 2013, 08:02 AM
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Fitch Ratings reports that increasingly, lenders to middle-market firms, also known as business development companies (BDCs), are turning to venture lending for additional investment opportunities and enhanced yields, as declining yields on...
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November 19, 2013, 07:18 AM
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The proposed U.S. rule covering minimum liquidity requirements for large banks would enforce a tougher standard than the Basel III international framework outlined in January. Fitch Ratings sees the proposed U.S. rule as generally positive for bank...
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October 28, 2013, 07:56 AM
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An inter-agency review of complex loans commonly held by multiple U.S. and foreign financial institutions indicates that improvements in asset quality have stalled year-over-year and underwriting standards have diminished post-crisis, highlighting...
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October 15, 2013, 07:21 AM
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The near-term fiscal challenges facing states and municipalities present a distinct risk, Fitch Ratings says.In the five years after the Great Recession, most states and municipalities have seen pronounced drops in revenue followed by a slow growth...
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September 16, 2013, 07:30 AM
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Increased exposure to floating-rate investments and generally heavy use of fixed rate funding has positioned U.S. business development companies (BDCs) well to adjust to the rising rate environment longer term, according to Fitch Ratings. However...
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August 16, 2013, 07:26 AM
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Catalysts are beginning to emerge that could prompt an increase in merger and acquisition activity in the U.S. banking sector over the immediate term, according to Fitch Ratings.
The growing factors include higher stock values for healthy...
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July 11, 2013, 07:22 AM
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The ongoing increase in leverage finance issuance and other related factors do not indicate that a return to the leveraged buyout (LBO) boom days of 2006-07 is likely, according to a new Fitch Ratings report.Fitch's report, 'U.S. Leveraged Finance...
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June 11, 2013, 07:43 AM
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Competitive pricing and easier terms offered by U.S. banks on commercial and industrial (C&I) loans likely signal weakening asset quality for many commercial lenders, according to Fitch. Fitch expects some deterioration in C&I credit quality...
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May 31, 2013, 07:29 AM
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Tighter risk spreads and continuing signs of over-heating in debt markets have led some U.S. business development companies (BDCs) to look for new growth opportunities. Several BDCs, which are largely cash flow lenders to middle-market companies...
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May 15, 2013, 07:53 AM
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Fitch Ratings has assigned a 'BB-/RR1' rating to J.C. Penney's new five-year $1.75 billion senior secured term loan facility. The closing of the new facility is contingent upon the successful tendering or defeasance (of at least two-thirds of the...
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May 01, 2013, 07:03 AM
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CFO.com reports that amid plunging sales and negative free cash flow, J.C. Penney taps its line of credit to finance inventory and operating expenses.
Retailing giant J.C. Penney company announced on Apr.15, it had tapped a portion of its $1.85...
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April 16, 2013, 08:05 AM
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Fitch Ratings rates Flowers Foods, Inc.'s new five-year senior unsecured term loan 'BBB' with commitment levels of up to $300 million. Pricing will be approximately LIBOR + 187.5 basis points. The proceeds will be used to help finance the pending...
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April 15, 2013, 07:27 AM
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Strong capital market conditions continue to support a pickup in unsecured debt issuance by U.S. business development companies (BDCs), primarily middle-market lenders, and this has enhanced funding flexibility for these firms, according to...
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April 10, 2013, 08:04 AM
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Fitch Ratings maintains the Rating Watch Positive on Dole Food Co., Inc. (Dole; NYSE DOLE) and Solvest Ltd. - Dole's wholly-owned subsidiary ratings as follows:
Dole (Operating Company)
Long-term Issuer Default Rating (IDR) 'B+';
Asset-based...
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March 19, 2013, 08:03 AM
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According to Fitch Ratings, approval of a Financial Accounting Standards Board (FASB) proposal on the treatment of credit losses for loans and other financial assets could eventually force U.S. banks to book expected losses early, putting pressure on...
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March 14, 2013, 08:03 AM
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Tentative signs of a pickup in large leveraged buyout and M&A transactions, financed in large part by leveraged loans, may boost fee revenues for major U.S. banks in the first quarter, but Fitch sees the potential for any sustained rise in deal...
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March 06, 2013, 07:31 AM
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The Readers Digest Association is the latest company to file a second Chapter 11 bankruptcy petition, commonly referred to as a Chapter 22. The terms of a pre-negotiated restructuring agreement would provide full recoveries for holders of secured...
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February 20, 2013, 07:51 AM
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U.S. banks holding large levels of nonperforming assets (NPAs) on their balance sheets are likely to pursue more bulk sales of distressed loans this year and next, according to Fitch Ratings. Four years after non-accruals began to spike during the...
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February 13, 2013, 07:19 AM
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Fitch Ratings has assigned a rating of 'BB-/RR1' to Rite Aid Corporation's (Rite Aid) proposed new $1.725 billion secured revolving credit facility due 2018, $900 million senior secured term loan B due 2020, and $470 senior secured second lien term...
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February 06, 2013, 08:07 AM
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U.S. asset-based lending (ABL) facilities present in a defaulted issuer's capital structure demonstrated complete recoveries in a bankruptcy scenario, according to a new Fitch Ratings report.
Fitch reviewed 12 recent U.S. bankruptcies - five...
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January 30, 2013, 08:04 AM
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Fitch Ratings has affirmed SUPERVALU Inc.'s (SVU) Issuer Default Rating (IDR) at 'CCC' following its announcement of a definitive agreement to sell its Albertsons, Acme, Jewel-Osco, Shaw's and Star Market stores and related Osco and Sav-on (brands...
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January 14, 2013, 07:04 AM
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According to Fitch Ratings, the agreement by regulators to change the definitions and stress assumptions in the Liquidity Coverage Ratio (LCR), delay its full implementation and allow banks to use their liquidity buffer in times of stress sets a more...
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January 10, 2013, 07:10 AM
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Loan refinancing activity and robust high-yield bond issuance extended or diminished $370 billion of loans within the refinancing cliff timeframe during the first three quarters of 2012. Despite the significant process made in 2012, the market still...
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January 07, 2013, 07:11 AM
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Rising bank regulatory costs, a persistently low interest rate environment, and weak equity valuations may force increasing numbers of private equity (PE) firms with investments in U.S. banks to consider alternatives to traditional exit strategies in...
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January 04, 2013, 07:34 AM
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Fitch expects 2012 holiday retail sales to grow between 3% and 4% versus 5.6% in 2011 despite a strong seasonal start. Total spending increased 13% during the Thanksgiving weekend, according to a survey conducted by the National Retail Federation...
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December 03, 2012, 08:03 AM
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Fitch Ratings has affirmed its ratings on Neiman Marcus, including the Issuer Default Rating (IDR) on Neiman Marcus, Inc. and its subsidiary, The Neiman Marcus Group, Inc., at 'B'. The Rating Outlook has been revised to Positive from Stable. NMG had...
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November 30, 2012, 07:26 AM
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U.S. covenant-lite loans have made a significant comeback in the leveraged finance market reflecting investor willingness to take on more risk in exchange for higher yields, according to a report by Fitch Ratings.
Year-to-date, covenant-lite loan...
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November 26, 2012, 07:01 AM
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The Federal Reserve's 2013 stress test scenarios for U.S. banks, which include a slowdown in Asia's developing economies on top of severe U.S. and euro zone recessions, are still as tough as last year, according to Fitch Ratings. However, we believe...
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November 19, 2012, 07:08 AM
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According to a news release from Fitch Ratings, the firm believes that loan loss reserve releases by U.S. banks will continue, albeit at a declining pace as banks begin to approach normalized provisioning and net chargeoffs After building up reserves...
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November 15, 2012, 07:16 AM
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