‘Fallen Angel’ Junk Tally Continues to Rise

The junk bond market may be about to get significantly bigger.

The number of companies with credit ratings downgraded to “junk” status could be headed for another record year, Standard & Poor’s said Monday.

“Globally, the annual total number and dollar value of ‘fallen angels’ this year will rival those of 2001,” the ratings firm said.

Fallen angels, companies that lose investment-grade ratings, have been on the rise for six years, S&P; said. So far this year, issuers with $47 billion of bonds have been cut to junk, a rating of BB-plus or lower, S&P; said. Last year, a record 57 issuers with $107 billion of debt were cut to junk.

S&P; said 69 issuers worldwide now are one notch above junk and are on review for downgrade or have a negative credit outlook.