EM Corporate Default Monitor: Bulky defaults in rear-view, downside risks in front-view

Research evidence excerpt

EM Corporate Default Monitor: Bulky defaults in rear-view, downside risks in front-view

J P M O R G A N Global Credit Research

21 July 2026

EM Corporate Default Monitor

Bulky defaults in rear-view, downside risks in front-view

Emerging Markets Corporate

Strategy

Alisa Meyers AC

(1-212) 834-9151

alisa.meyers@jpmorgan.com

J.P. Morgan Securities LLC

• Default rates are trailing our forecasts. Global EM corporate HY default rate Yang-Myung Hong

is 2.5% YTD vs. 4.3% forecast, leaving 1.8% — or about $9.6bn — to year-

(1-212) 834-4274

end, which is conservative, given most bulky events have already materialized. ym.hong@jpmorgan.com

• We keep our 2026 default forecast at 4.3%, but continue to see downside J.P. Morgan Securities LLC

risks. The thematic message remains unchanged: large realized candidates, Dhawal U Mehta

limited unexpected additions, and no evidence of a generalized EM corporate (91-22) 6157 3779

dhawal.mehta@jpmchase.com

default wave. Indeed, the issuer-weighted default rate is only 0.8% YTD, J.P. Morgan India Private Limited

reinforcing our concentration rather than contagion view. Emerging Markets Corporate

• High-par vs. low-issuer-count default rate dynamic is playing out as Research

expected. Braskem and Raizen were the 8th and 13th largest EM corporate Soo Chong Lim

defaults of all time, respectively, driving the YTD increase in the par default (852) 2800-7387

rate without a broadening in the list of issuers facing credit events. soochong.lim@jpmorgan.com

J.P. Morgan Securities (Asia Pacific) Limited

• 2H26 picture cleared materially, especially for Latin America. Latin Natalia Corfield

America YTD default rate is 6.2%; Braskem alone contributed 3.5% to LatAm (1-212) 834-9150

and 1.3% to Global EM HY default rate.