Gainful period for high yield

Market growth in 2004 set to top last year’s record-setting levels of issuance.

In 2003, the high yield market had a record amount of new issuance as 515 deals priced for a total of $141.1bn (e117bn) in proceeds, according to Merrill Lynch index data. The previous record of new issuance was in 1998, which experienced a sum of $140.9bn.

However, issuance in 2004 through March 31 is on pace to break last year’s record as $46.3bn of new issuance has priced in the first quarter. According to Moody’s Investors Service, the high yield market has grown in size from $452.1bn in 1998 to approximately $695.2bn at the end of March 2004, representing nearly 54 per cent growth. Incidentally, high yield bonds as a percentage of outstanding corporate bonds represented 17.8 per cent on March 31, 2004, according to Moody’s.