The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.

Breakingviews: The credit research crunch

Source: is Europe's leading financial commentary service.

Date: May 2003

The credit research industry ought to be prospering. More European companies have been issuing bonds since the launch of the euro in 1999, and lots of these issuers are now being downgraded by the credit rating agencies. All this points to a pressing need for more insightful analysis. But the industry does not look able to meet this need.

The downturn in credit quality is among the sharpest on record. Look at the crop of euro-denominated non-financial borrowers. More than half of them are rated triple B - the lowest investment-grade rating - or below. At this low level, bonds become extremely volatile. Investors need to know more about what is going on, not less.

But the research industry isn't expanding to provide this extra coverage. There are signs, indeed, that it may be starting to shrink. There are two main reasons for this. One is that credit research budgets generally form part of wider research budgets, and these are being slashed in the wake of the equity market downturn.

Take out a complimentary trial

Take out a 7 day trial to gain unlimited access to and analysis and receive expertly-curated updates direct to your inbox.


Already a user?

Login now


We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree