NEW YORK Corporate bond defaults rose 30% in the second quarter, compared with the first, according to a report published Monday by Moodys Investors Service.
The report said that 37 corporations rated by Moodys had defaulted on a total of $9.6 billion of debt; U.S. issuers dominated the list of problem borrowers.
The trailing, 12-month default rate at the end of June was 5.4% for non-investment-grade issues.
In the first quarter, 23 corporations missed or delayed payments on $7.4 billion worth of bonds, Moodys said.
The second-quarter default rate was slightly lower than the year earlier, when 39 corporations defaulted on $10.5 billion of debt.
Moodys said the worsening credit quality of issuers that tapped the market in 1997 and 1998 is expected to continue to push up default rates, which could reach as high as 8.4% for non-investment-grade issues by next June.