In 2023, we estimate that the default rate in the United States on IEO bonds in 2023 will be about 3.5%. That's a little above the historic average. The 1.6% for IEO bond default rates through the first half of this year will get us to about the historic average by the end of the year. And so while default rates are much higher than they were last year and the year before, they are still about average.
In this week’s Primary View podcast, Dr. Edward Altman, the legendary bankruptcy expert, discusses the outlook for debt-saddled zombie companies with Reorg reporter Gaurav Sharma. The New York University professor, best known for the Z-Score formula, cautions that bankruptcy cases are likely to increase in 2024-25, even if the U.S. avoids a recession.
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