Bankruptcies rise 27% and hit record highs in Europe

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Santander | One good one, and then… And while flows into IG funds reach record highs of $19mm YTD globally, corporate bankruptcies have also jumped to record highs in the EU. And they grew by +27% in Q4 to the highest level since Eurostat has been collecting data (2015). On the other hand, although the technical picture is undoubtedly good, the trajectory is not. And while Europe is experiencing a clear slowdown in inflows ($674mn last week vs $1.4mm weekly average YTD), $ credit funds experienced strong outflows last week ($5.7mm), the worst since August, with $IG -2.9mm and $HY -$2.8mm. In this context, and in another intense week of primary (€24mm, although from more to less) and negative returns in credit, demand slowed sharply to a b/c of 2x (4x the previous week) with some issues trading above reoffer (Vodafone and Unicredit’s SNP, +7bp, for example). Curves for a primary after two weeks of secondary increases (iBoxx EUR Banks Senior +9bp, iBoxx EUR NonFin +5bp since 7 February) and experiencing the last week of total ECB maturity buybacks before the start of QT on 1 March.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.