Moody’s Says 25% of Distressed Exchange Firms End in Hard Default
Updated
Updated · Bloomberg · May 19
Moody’s Says 25% of Distressed Exchange Firms End in Hard Default
1 articles · Updated · Bloomberg · May 19
About 25% of companies that complete a distressed exchange later fall into hard default, including bankruptcy filings or missed payments, Moody’s Analytics said.
The warning suggests liability-management moves often buy only limited time rather than restore a durable capital structure for struggling borrowers.
Distressed exchanges, debt-document modifications and debt impairments are increasingly used by companies under pressure, but Moody’s said those measures frequently fail to put them on stable footing.
With one in four distressed firms facing bankruptcy, why do lenders keep opting for risky exchanges over formal restructuring?
As $930 billion in real estate loans come due, is the market facing a crisis beyond 'extend and pretend'?
Are private equity's debt-heavy strategies creating a generation of companies that are simply built to fail?