LONDON (Reuters) – The Standard & Poor’s Global analysis shows that the number of companies or countries at risk of lowering their credit rating to high-risk investment grade has reached a record high of 111 due to the Corona virus pandemic.
Standard & Poor’s estimates that the number of companies and countries that have been downgraded in this way has already reached 24 this year, affecting debt of more than $ 300 billion. The 111 companies and countries that are nominated for this downgrade have bonds valued at another $ 444 billion, meaning that the amount is likely to jump much more.
The companies and the candidate countries are important because the extent of the loss of ratings worthy of the investment can prompt investors to sell the bonds for more creditworthy companies, which increases their borrowing costs.
“Sustaining credit pressure continues to accumulate,” Standard & Poor’s said, highlighting that nearly a quarter of the number of companies at risk of downgrade to high risk of 111 is also subject to explicit warning of downgrade.
Major retail names such as Ford, Kraft Heinz, Renault, Delta Airlines, Masses, Marks and Spencer in the retail sector have already been stripped of the investment worthy sign since the Corona virus has hit major economies.
The list of candidates for the reduction includes some of the names that are inferior, including the two national airlines British Airways and Lufthansa, the two international hotel chains Hayat, Marriott, and the two mining giants ArcelorMittal and the Brazilian elephant.