USD4.1trn of European financial and non-financial corporate debt rated by Standard & Poor's Ratings Services is expected to mature between 2014 and 2018.
Of this USD4.1trn, USD866m is scheduled to mature in 2014 and, given normal data reporting lags, the credit market may have already accommodated a portion of this amount.
After 2014, the annual scheduled maturities are USD909bn in 2015, USD863bn in 2016, USD754bn in 2017, and USD678bn in 2018.
Financial companies account for 60 per cent (USD2.4trn) of Europe's maturing debt, and 86 per cent (USD3.5trn) of the debt is rated investment grade ('BBB-' and higher), which should help temper the region's overall refunding risk.
Nonetheless, the amount of maturing debt at the lowest rating levels remains significant.
More than USD10bn of debt rated 'B-' and lower will mature in 2014 and 2015, after which the amount rises markedly to more than USD55bn for 2016, 2017, and 2018.
Moreover, there is considerable leveraged debt that is not included in the database, which adds to the overall risk in the credit markets.
"The lowest rated debt issuances are the most susceptible to the uncertainty in the region," says Diane Vazza, head of Standard & Poor's global fixed income research. "Geopolitical instability, both within and outside of Europe, could pose a significant risk that may give investors pause."
The current situation in Ukraine is very delicate, and investor concerns over this geopolitical showdown could impede the financing and refinancing prospects of some European companies. In the financial sector, banks continue to face some headwinds that could complicate their own efforts to raise capital, which, along with the ECB's Asset Quality Review scheduled for later this year, could hinder them from lending more freely to other companies, particularly those that are more leveraged.
