Standard & Poor’s Ratings Services downgrade of the Republic of Portugal to ‘BBB-‘ on March 29 created one new fallen angel and added six Portuguese companies plus the Republic of Portugal to the list of potential fallen angels, said a new article published by Standard & Poor’s, titled “Global Fallen Angels: Total Continues To Rise As Tensions Unfold In Europe And The Middle East.”
The fallen angels account for $141 billion in rated debt. This total is significantly more than the $44.4 billion in rated debt attributable to this year’s 13 rising stars, issuers upgraded to investment grade.
S&P noted last month, economic tensions among European sovereigns and social unrest in the Middle East continue to weaken credit quality and contribute to the growing number of fallen angels in 2011.
“Since our previous report, five new fallen angels were downgraded to speculative grade from investment grade through April 14,” said Diane Vazza, head of Standard & Poor’s Global Fixed Income Research. “Three of these companies were downgraded as a result of European and Middle Eastern tensions. This brings the number of global fallen angels in 2011 to 16.”