Prospect News notches one new default for week; S&P reports none

By Jennifer Lanning Drey

Savannah, Ga., May 20 - Prospect News reported one new default for the week ended May 19 in the form of Merit Group, Inc.'s Chapter 11 bankruptcy filing.

Standard & Poor's saw no new defaults during the period.

S&P's global corporate default tally remains at 15 issuers. In comparison, 37 global corporate issuers had defaulted by this time in 2010.

S&P said that 10 of this year's defaults were based in the United States, two were based in New Zealand, and one each was based in Canada, the Czech Republic and Russia.

The rating agency said that six of this year's defaults resulted from distressed exchanges and five from missed interest or principal payments, both among the top reasons for default in 2010.

Of the remaining four, two issuers defaulted after they filed for bankruptcy, another had its banking license revoked by its country's central bank and the third was forced into liquidation as a result of regulatory action.

Of the defaults in 2010, 28 defaults resulted from missed interest or principal payments, 25 resulted from Chapter 11 and foreign bankruptcy filings, 23 from distressed exchanges, three from receiverships, one from regulatory directions and one from administration.

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