Fitch warns of double default risks as A&Es come home to roost

07 Dec 2012

A series of second defaults could hit European leveraged loan borrowers, Fitch warned this week. And this time around, the losses could be heavier, the agency warned, particularly for those situations where loan investors achieved high recovery rates in the first round.

In an opinion published on Monday, the credit rating agency singled out 2010 as a year when recoveries on defaults did not "reflect accurately the true value of the defaulted and restructured debts for many low-rated European leveraged borrowers".

In addition, Fitch said that European restructurings in 2009 and ...

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