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COMMENTS

Default, Transition, and Recovery: China-Based Sinic Holdings' Missed Bond Payment Pushes The 2021 Global Corporate Default Tally To 63

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Default, Transition, and Recovery: Two Defaults Brings The Corporate Tally To 67

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Default, Transition, and Recovery: The European Speculative-Grade Corporate Default Rate Could Reach 2.5% By September 2022


Default, Transition, and Recovery: China-Based Sinic Holdings' Missed Bond Payment Pushes The 2021 Global Corporate Default Tally To 63

The 2021 global corporate default tally increased to 63 this week following the default of China-based (Cayman Islands-incorporated) real estate developer Sinic Holdings (Group) Co. Ltd. after the issuer failed to repay the interest and principal on its US$250 million offshore senior unsecured notes due on Oct. 18, 2021 (see "Sinic Holdings Downgraded To 'SD' On Missed Bond Payment," Oct. 19, 2021).

So far in 2021, seven homebuilders and real estate companies have defaulted, four of which are based in China and incorporated in the Cayman Islands (see chart 1). Two of these defaults (Sinic Holdings and Fantasia Holdings Group Co. Ltd.) were recorded in October. The sector recently has been rattled by contagion risks related to Evergrande as developers with concentrated maturities and deteriorating liquidity have been left exposed (see "Credit FAQ: Evergrande Default Contagion Risk--Ripple Or Wave?," Sept. 20, 2021.)

Chart 1

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Globally, defaults in 2021 remain low--the current tally is the third-lowest year-to-date default count, following the 49 defaults and 32 defaults in 2014 and 2011, respectively. With no new defaults in the U.S. and Europe in September, the 12-month-trailing speculative-grade default rate fell to 2.4% for the U.S. and 3.4% for Europe.

This Week's Observations

  • So far, two-thirds of this month's defaults have been from the homebuilders and real estate sector as there has been a pickup in defaults from China-based issuers in the sector.
  • The U.S. leads the 2021 default tally with 34, followed by Europe and the emerging markets with 13 defaults each (see chart 3).
  • So far in 2021, around 52% of the defaults were related to distressed exchanges while missed payments accounted for 22% (see chart 5).

Chart 2

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Chart 3

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Chart 4

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Chart 5

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Chart 6

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Table 1

The U.S. Leads 2021 Defaults With 34 Out Of 63
Region 12-month-trailing speculative-grade default rate (%) 2021 YTD 2020 YTD 2020 Weakest links
U.S. 2.4 34 129 146 165
Emerging market 2.2 13 26 28 22
Europe 3.4 13 32 42 58
Other developed 3.0 3 9 10 15
Global 2.6 63 196 226 260
Note: Trailing-12-month default rates are from Sept. 30, 2020-Sept. 30, 2021. Year-to-date data as of Oct. 20. Weakest link data is as of Aug. 31, 2021. Other developed region is Australia, Canada, Japan, and New Zealand. Default counts may include confidentially rated issuers. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®.

Table 2

The 2021 Global Corporate Default Tally Inches To 63
Date Parent company Country Subsector To From Reason
1/5/21

HGIM Corp.

U.S. Oil and gas SD CC Distressed exchange
1/6/21

Promotora de Informaciones S.A.

Spain Media and entertainment SD CC Distressed exchange
1/8/21

Burger BossCo Intermediate Inc.

U.S. Retail/restaurants SD CCC Distressed exchange
1/8/21

Riverbed Parent Inc.

U.S. High technology SD CC Distressed exchange
1/21/21

AMC Entertainment Holdings Inc.

U.S. Media and entertainment SD CC Distressed exchange
1/25/21

Awesome Acquisition Co. L.P.

U.S. Retail/restaurants D NR Chapter 11
1/25/21

Alpha Media LLC

U.S. Media and entertainment D NR Bankruptcy
1/27/21

Imagine Group LLC (The)

U.S. Media and entertainment D CCC Distressed exchange
2/2/21

Belk Inc.

U.S. Retail/restaurants D CC Missed interest payments
2/3/21

Peabody Energy Corp.*

U.S. Metals, mining, and steel SD CC Distressed exchange
2/3/21 Confidential Confidential Health care SD CCC- Confidential
2/11/21 Confidential Confidential Automotive D CCC- Confidential
2/11/21

Vallourec

France Oil and gas SD CC Missed principal payments
2/19/21

Renfro Corp.

U.S. Consumer products SD CCC- Distressed exchange
2/22/21

CatLuxe Sarl (CatLuxe Acquisition Sarl)

Luxembourg Consumer products SD CCC+ Distressed exchange
2/22/21

Form Technologies LLC

U.S. Capital goods SD CC Distressed exchange
2/26/21

YPF S.A.

Argentina Oil and gas SD CC Distressed exchange
3/2/21

Sunshine 100 China Holdings Ltd.*

Cayman Islands Homebuilders/real estate companies SD CCC- Distressed exchange
3/7/21 Confidential Confidential Financial institutions D NR Confidential
3/8/21 Confidential Confidential Financial institutions D B+ Confidential
3/16/21

Ensign Drilling Inc. (Ensign Energy Services Inc.)

Canada Oil and gas SD CCC+ Distressed exchange
3/16/21

HighPoint Resources Corp.

U.S. Oil and gas D CC Chapter 11
3/17/21

Washington Prime Group Inc.

U.S. Homebuilders/real estate companies D CC Missed interest payments
3/18/21 Confidential Confidential Consumer products D CCC Confidential
3/23/21

AI Mistral Holdco Ltd.

U.K. Transportation SD CCC+ Distressed exchange
3/26/21

Avation PLC

U.K. Transportation SD CC Distressed exchange
4/13/21

YPF Energia Electrica S.A. (YPF S.A)

Argentina Utilities SD CCC- Distressed exchange
4/14/21

ION Geophysical Corp.

U.S. Oil and gas SD CC Distressed exchange
4/15/21

Summit Midstream Partners L.P.

U.S. Midstream SD CC Distressed exchange
4/16/21

Basic Energy Services Inc.

U.S. Oil and gas D CCC- Missed interest payments
4/19/21

Medical Depot Holdings Inc.

U.S. Health care SD CCC+ Distressed exchange
4/19/21

Serta Simmons Bedding LLC

U.S. Consumer products SD CC Distressed exchange
4/23/21

Isagenix Worldwide, Inc

U.S. Consumer products SD CCC Distressed exchange
4/26/21 Confidential Confidential High technology SD CCC+ Confidential
4/27/21

Maxcom Telecomunicaciones, S.A.B. de C.V.

Mexico Telecommunications D CCC- Missed interest payments
4/28/21

Future Retail Ltd.

India Retail/restaurants SD CCC- Distressed exchange
4/28/21 Confidential Confidential Consumer products SD CCC- Confidential
4/30/21

Codere S.A.

Spain Media and entertainment SD CC Distressed exchange
5/3/21 Confidential Confidential Transportation D CC Confidential
5/10/21

gategroup Holding AG

Switzerland Transportation SD CCC Distressed exchange
5/10/21

Voyager Aviation Holdings LLC

U.S. Transportation SD CC Distressed exchange
5/14/21

CDRH Parent Inc.

U.S. Health care D CC Distressed exchange
5/19/21

Boart Longyear Ltd.

Australia Metals, mining, and steel D CC Bankruptcy
5/25/21 Confidential Confidential Homebuilders/real estate companies D CCC- Confidential
6/3/21

Peabody Energy Corp.*

U.S. Metals, mining, and steel SD CCC+ Distressed exchange
6/23/21

Carlson Travel Inc.

U.S. Media and entertainment D CCC Missed interest payments
6/23/21 Confidential Confidential Consumer products D CCC- Confidential
7/1/21

GTT Communications Inc.

U.S. Telecommunications SD CCC- Missed interest payments
7/8/21

KCIBT Holdings L.P.

U.S. Consumer products SD CCC Distressed exchange
7/9/21

Joye Media SLU

Spain Media and entertainment D CCC- Missed interest payments
7/12/21

Peabody Energy Corp.*

U.S. Metals, mining, and steel SD CCC Distressed exchange
7/13/21

Sichuan Languang Development Co. Ltd.

China Homebuilders/real estate companies D CCC- Missed bond repayment
7/20/21

Alpha Holding S.A. de C.V.

Mexico Financial institutions D CC Missed interest payments
7/30/21

Comdata Spa

Italy Financial institutions SD CC Distressed exchange
8/3/21 Confidential Confidential Transportation SD CC Confidential
8/9/21

Glass Mountain Pipeline, LLC

U.S. Utilities D CC Missed interest payments
8/11/21

Sunshine 100 China Holdings Ltd.*

Cayman Islands Homebuilders/real estate companies SD CCC- Missed bond repayment
8/13/21

CLISA-Compania Latinoamericana de Infraestructura & Servicios S.A.

Argentina Capital goods SD CC Distressed exchange
9/21/21

Array Canada Inc.

Canada Consumer products SD CCC Distressed exchange
9/29/21 Confidential Confidential Financial institutions D B- Confidential
10/4/21

IPC Corp.

United States Telecommunications SD CCC- Distressed exchange
10/5/21

Fantasia Holdings Group Co. Ltd.

Cayman Islands Homebuilders/real estate companies SD CCC Missed bond repayment
10/19/21

Sinic Holdings (Group) Co. Ltd.

Cayman Islands Homebuilders/real estate companies SD CC Missed bond repayment
Note: Sunshine 100 China Holdings Ltd., Fantasia Holdings Group Co. Ltd., and Sinic Holdings (Group) Co. Ltd. are incorporated in the Cayman Islands but invest, develop, and manage real estate properties in the People’s Republic of China. Companies incorporated in the Cayman Islands are included in the U.S. default rate computation due to the location as a U.S. tax haven. *Indicates the issuer defaulted multiple times in 2021. Data as of Oct. 20, 2021. NR--Not rated. SD--Selective default. *Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®.

Related Research

Default Studies

More analysis and statistics are available in our annual default studies, published on RatingsDirect:

Corporate (financial and nonfinancial)
Structured finance
U.S. public finance
Sovereign and international public finance

This report does not constitute a rating action.

Credit Markets Research:Nicole Serino, New York + 1 (212) 438 1396;
nicole.serino@spglobal.com
Secondary Contact:David C Tesher, New York + 212-438-2618;
david.tesher@spglobal.com
Research Contributor:Tanya Dias, CRISIL Global Analytical Center, an S&P affiliate, Mumbai

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