[PEN-L:28700] credit stresses

["Ian Murray" <seamus2001@xxxxxxxxx>]

It is perhaps predictable that just as commercial banks raced to generate fees from underwriting
debt securities, more of the companies issuing them are falling on hard times. According to a study
to be released on Monday by Moody's Investors Service, a total of 89 corporate bond issuers
defaulted in the first half of 2002 with bonds totaling $64 billion. Twenty-one issuers defaulted on
issues greater than $1 billion each. None of these numbers include WorldCom's bankruptcy filing,
which occurred in the third quarter.

"A stubbornly high pace of defaults, assisted by the spectacular number and size of failures in the
telecommunications sector globally and by other issuers based outside the United States, made the
second quarter 2002 one of the most severe periods of credit stress since the Depression of the
1930's," said David T. Hamilton, who wrote the study.

http://www.nytimes.com/2002/07/28/business/yourmoney/28BANK.html