November 10, 2016 / 7:12 PM / 2 years ago

Brazil's Samarco lifts Yankee high-yield default rate to 6-year high-Fitch

SAO PAULO, Nov 10 (Reuters) - An index tracking high yield bond defaults jumped the most in more than six years after Brazilian miner Samarco Mineração SA missed an interest payment on its U.S. dollar bonds, according to a Fitch Ratings report Thursday.

The Yankee index, which measures the high yield bond default rate over the past 12 months, finished October at 6.2 percent, its highest level since February 2010, Fitch said.

The Yankee universe covers about 15 percent of the U.S. high yield market, giving credit events such as bankruptcy filings, distressed debt exchanges and missed interest payments “an outsized impact on its default rate,” according to Fitch.

The overall reading for U.S. high yield defaults rate rose to 4.9 percent in October, the rating agency added.

Samarco, a 50-50 joint venture between Brazil’s Vale SA and Australia’s BHP Billiton Ltd, suspended operations in November following a dam disaster. It has $2.2 billion in outstanding bond obligations.

Reuters reported on Sept. 26 that Samarco missed an interest payment on a $500 million bond, according to trustee Bank of New York Mellon Corp. The company said on Oct. 24 that it missed another $20 million interest payment. (Reporting by Ana Mano; Editing by Bernadette Baum)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below