The collapse of oil has undermined the solvency of States and companies


Moscow. On 19 January. Credit default swaps (CDS) on bonds of a number of States that have investment rating at least one of the rating agencies, including government securities Russia, are at levels typical for bonds with speculative ratings categories, according to data from Markit.

So, the cost of insuring against default on government bonds Russia is 339 basis points (b.p.), Kazakhstan – 339 b also.p., South Africa – 340 b.p., Turkey – 301 b.p.

According to estimates Markit, CDS on bonds 110 companies with investment grade ratings are now at levels consistent with speculative ratings. This indicates the possibility of downgrades, experts say.

For comparison: in November 2015 such a situation was noted in respect of the securities of the company only 21.

The results of the analysis show that the fall in oil prices and other raw materials negatively affects the creditworthiness of companies, writes the Financial Times. Six out of seven of the widest CDS spreads fall on bonds of mining companies or commodity traders.

Out of 110 companies with ratings of investment grade, CDS on bonds which, according to estimates by Markit, correspond to the level of companies with speculative ratings 21 company – representatives of the energy sector.

Some of the mining companies in recent months has experienced a sharp rise in CDS spreads, says analyst Markit Joel Levin.

Markit data indicating an overall deterioration of the creditworthiness of companies, and confirmed the rating Agency Standard & Poor’s.

In the report S&P released last week, notes that the number of companies threatened downgrades of as much as three times the number of companies whose ratings can be improved.

The deterioration of the creditworthiness of international companies in the second half of 2015 was the most significant from the peak of the financial crisis in 2009, experts say S&P.

Rating Agency Fitch keeps long-term Issuer default rating of the Russian Federation in foreign and national currency at “BBB -” corresponding category “investment”. The forecast of ratings – “negative”.

Ratings of Russia by S&P and Moody’s are in the category “speculative”.