September 2023 Industry Monitor

Download the latest Industry Monitor below.

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

Financials and Corporates are very close to being balanced between improvement and deterioration this month. Financials are very narrowly tipped towards net credit deterioration, with a ratio of 1:1.1. Corporates are slightly tipped in the opposite direction, with an improving to deteriorating ratio of 1.1:1.

Industry Level Credit Movement:

Amongst the Industries, Technology firms are the worst performer this month, with a ratio of 1.5 deteriorations to every improvement. Heath Care follows close behind at 1:1.4 improvements to deteriorations. Most of the Industries are close to balance this month, though Consumer Goods firms have come out on top with a positive ratio of 1.4 improvements to each deterioration.

Sector Level Credit Movement:

The sectors show more variance in credit quality, with Canada Oil & Gas firms coming out strong with a 3:1 improvement to deterioration ratio. UK Oil & Gas firms also performed well with a positive ratio of 1.9:1. Travel and Leisure firms are not far behind at 1.6:1. Of those that fared negatively, US Corporates are the worst affected, with an improving to deteriorating ratio of 1:1.3. This trend was reflected across North America, with Canada Corporates and US Oil & Gas both showing a ratio of 1:1.2.

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.

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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.