Revenue and Issuance Analysis

MOODY'S Global Default Rates Remain Under Historic Average; Continue to Monitor Covenant Quality Default Rates for Speculative- Grade Corporate Rated Issuance1 Speculative-Grade Covenant Quality Indicators U.S. Loans 5.00 Global U.S. Europe 16.0% 14.0% 4.50 12.0% 4.00 10.0% 8.0% 6.0% 4.1% global historic average¹ 3.50 4.0% -3.7% 3.00 3.7% 2.0% 3.6% 2.50 0.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 3Q19 3Q20F U.S. Bonds -European Bonds Weakening 4.51x 3.88x 3.75x Improving 2.00 2012 2013 2014 2015 2016 2017 2018 3Q192 » Global speculative-grade default rate at 2.4% as of September 30, 2019; expected to increase to 3.6% by September 2020 1. 2. Recent strengthening in U.S. loan covenants reflects weakening investor demand, while U.S. bond covenants weaken simultaneously with pickup in issuance activity Moody's rated corporate global speculative grade default historical average of 4.2% from 1983 through 2018. 2020 forecast for trailing twelve months ended September 30, 2020. As of the trailing twelve months ended September 30, 2019. Source: Moody's Investors Service. November 4, 2019 21

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