At the recent PRMIA Credit Forum in New York, one slide from an early morning presentation leaped off of the screen. The slide depicted the number of issuers coming to the marketplace at below investment grade. In 2000, less than 100 Single-B issuers came to market. In 2007, that number had grown to nearly 250. In 2000, slightly more than half of the issuers were below investment grade. By 2007, the figure was 82%. At the same time, the number of issuers who were able to come to market increased by 56 percent. Said another presenter, “10 years ago, most of these firms could never have issued”. So, what gives today that allows firms of sub-investment grade credit the ability to come to market? The answer may come from “animalistic behavior” in pension funds.
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