Global debt issuance hits record high in ’16

LONDON — Global private debt issuance reached a record high of $3.9 trillion in 2016, up 9% from 2015, driven in part by stronger issuance in emerging markets, Moody’s Investors Service said in “Global Issuance Monitor Q4 2016: Despite Lacklustre Fourth Quarter, Global Issuance Hits Record High in 2016”, report recently, citing Dealogic data. The record figure was achieved over the full year despite a 26% quarterly decline in the final three months. “Despite a weaker final quarter, global private market issuance reached a record high in 2016,” said Rahul Ghosh, a Moody’s Vice President – Senior Credit Officer and co-author of the report. “A strong third quarter, particularly in emerging markets, contributed to the record total over the year.” Issuers in advanced economies (AEs) tapped $502 billion in primary markets in Q4 2016, little changed from the same period in 2015, but down 26% over the quarter. Non-financial corporation (NFC) issuance rose 13% year-on-year, led by North American issuers, while financial institutions’ issuance was 14% lower than a year ago, mainly due to lower volumes by European issuers. In 2016 as a whole, total private sector issuance in advanced economies climbed 3% compared to 2015 to stand at $2.65 trillion. Total issuance in emerging markets in 2016 was 22% higher than the previous year at $1.294 trillion on growing Chinese primary markets, despite a 25% quarter-on-quarter decline in Q4. Global high-yield (HY) placements increased 75% in Q4 2016 from depressed year earlier levels in virtually all regions that Moody’s tracks. In particular, North American NFCs’ HY placements showed robust momentum in 2016. It was the only larger global primary market segment to grow on both the year and the quarter, according to Moody’s classifications. — SG