The credit ratings of global corporates continued to drift to the downside in the first quarter of 2012, according to a new report by Fitch Ratings.
The rating agency reports that downgrades outnumbered upgrades by a margin of 2.2 to 1.0 in the quarter. While this ratio is less severe than the previous quarter’s 3 to 1 ratio, it still a marked departure from the more balanced rating activity recorded in 2010 and the first three quarters of 2011, Fitch says.
Downgrades affected 4.6% of global corporate issuers in the quarter, down from 7.1% in the fourth quarter of 2011. Upgrades impacted 2.1% of issuer ratings, down from 2.3% in the prior quarter.
Credit quality dipped further across the universe of Fitch-rated global financial institutions, it reports, with downgrades affecting 6.2% of issuers and upgrades affecting just 1.5%.
Rating activity remained far more even across industrials although downgrades (3.2%) still outpaced upgrades (2.6%).
Also, the share of Fitch’s global corporate issuers assigned a Negative Outlook rose to 11% at the end of March, from 8% in December 2011, and the share of issuers carrying a Positive Outlook slipped to 6% at the end of the first quarter, compared with 7% at year end.