The remaining maturities for high yield bonds and leveraged loans for 2024 account for only around 1% of the total market. The significant volume of bond refinancings in 2024 and 2023 after a year of record lows in 2022 has led to this accelerated debt absorption.
The USD 30 billion of outstanding bonds and loans maturing this year involve 66 issuers. The credit risk in the market is much higher for loans vs. bonds, as the outstanding loan issuers seeking refinancing are mainly CCC-rated loans. We therefore expect some of them to default.
Nevertheless, given the low volume, this will only lead to a slight increase in the expected default rate. Potential challenges are more likely to arise in the future when refinancing activities for the 2027 and 2028 maturities begin.
