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Credit conditions in Asia-Pacific getting less favourable: S&P

Wednesday, February 24, 2016 - 09:30

CREDIT conditions are tightening, which can lead to higher funding costs and less credit to fund corporate growth, said ratings agency Standard and Poor's (S&P) in a Feb 23 report.

"With the global collapse in commodity prices, slowing growth and falling equities in China, and the appreciation of the US dollar, companies in the Asia-Pacific region could find credit conditions to be less favourable for refunding debt in the coming years," it said.

S&P said that some US$961 billion of Asia-Pacific corporate debt that it rates will mature from 2016 to 2020.

This comprises a 10th of debt maturing globally.

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Some US$191.3 billion is scheduled to mature in 2016. This will rise to US$219.5 billion in 2017, before declining slightly.

The median maturity for all Asia-Pacific rated corporate debt is four years.

Nearly 90 per cent of the total Asia-Pacific debt maturing through 2020 is investment-grade, rated BBB- and higher, S&P said.

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