AFX News Limited Moody’s sees global defaults on syndicated bank loans accelerating in 2008 ,

NEW YORK (Thomson Financial) - Moody’s Investors Service said Thursday it expects the global speculative-grade default rate on syndicated bank loans to climb to 4.8% by the end of 2008 from its current level of 0.9%. The firm anticipates the equivalent rate in the U.S. will swell to 3% by the end of the year from its current level of 0.1%.

‘Both weaker macroeconomic fundamentals and a worsening in the ratings mix of speculative-grade issuers are the underlying factors driving the 2008 default rate forecasts,’ said Kenneth Emery, Moody’s ) director of corporate default research, in a statement. Moody’s said 20 issuers defaulted on $2.9 billion in syndicated bank loans in 2007, down from 2006 when 32 issuers defaulted on $6.3 billion in loans. The only 2007 defaulter to be rated by Moody’s was Movie Gallery Inc.

), whose default on $900 million in loans in September was 2007’s largest default, the firm said. Michael Baron mb/jw COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.

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