Corporates seek to cover their embarrassment

These are not happy times in corporate credit. Accounting and trading scandals, miserable results and defaults have produced dire results for investment-grade issuance. Now finance directors are doing their utmost to avoid suffering humiliation in the markets.

As one debt capital markets banker remarks about the world’s corporate bond issuers: “Nobody wants to be caught on the stage with their pants down.” It’s too true – when the market and media are obsessed with the latest accountancy scam, earnings restatement, ratings downgrade or liquidity scare, avoiding a simultaneous bout of pant-dropping and limelight-hogging in the corporate credit markets has been a major concern for all finance directors since the beginning of the year.

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