February 2022 Industry Monitor

Download the February Industry Monitor infographic below.

Credit Benchmark have released the end-month industry update for end-January, based on the final and complete set of the contributed credit risk estimates from 40+ global financial institutions.

Corporate credit quality continues to improve, as does that of Financials. In this month’s credit consensus update, almost all industries and sectors showed a dominance of improvement over deterioration.

Corporates performed slightly better than Financials, with an improvements to deteriorations ratio of 1.7:1, while Financials still remained in the green with a ratio of 1.4:1.

Out of the industries, the stand out this month was Basic Materials, with a ratio of 2.5 improvements to every deterioration. Consumer Goods and Consumer Services were level, both with a ratio of 1.7:1, as well as Health Care. Technology remained neutral with a ratio of 1:1. The only instance of net deterioration was in Utilities – only barely tipping the balance into the red.

Amid the sectors, the Canadians came out on top, dominating in both overall Corporates with an improving to deteriorating ratio of 3.2:1, but also notably in Oil & Gas, at 4.7:1, likely due to new pipeline connections and expansions in the US Gulf. US and UK Oil & Gas also performed well. There were no instances of net deterioration among the sectors this month, though UK Corporates were comparatively the weakest performer, still with a positive ratio of 1.3:1.

In the update, you will find:

  • Credit Consensus Distribution Changes: The net increase or decrease of entities in the given rating category since the last update.
  • Credit Transition: Assesses the month-over-month observation-level net downgrades or upgrades, shown as a percentage of the total number of entities within each category.
  • Ratio: Ratio of Improvements and Deteriorations in each category since last update, calculated as Improvements : Deteriorations.
  • IG to HY Migration: The number of companies which have migrated from investment-grade to high-yield since the last update (known as Fallen Angels).

Credit Benchmark will continue to provide regular reports on these migration rates. If you have any questions about the contents of this update, please get in touch.

For full details, please download the February Industry Monitor infographic here:

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    Credit Benchmark brings together internal credit risk views from over 40 leading global financial institutions. The contributions are anonymized, aggregated, and published in the form of consensus ratings and aggregate analytics to provide an independent, real-world perspective of credit risk. Risk and investment professionals at banks, insurance companies, asset managers and other financial firms use the data for insights into the unrated, monitoring and alerting within their portfolios, benchmarking, assessing and analyzing trends, and fulfilling regulatory requirements and capital.