JPM EM Corporate Strategy Daily

Research evidence excerpt

JPM EM Corporate Strategy Daily

J P M O R G A N Global Credit Research

21 July 2026

Emerging Markets Corporate

Strategy

Yang-Myung Hong AC

(1-212) 834-4274

ym.hong@jpmorgan.com

J.P. Morgan Securities LLC

We published our EM Corporate Default Monitor in which we note that default

Alisa Meyers

rates so far this year are trailing our forecasts. Global EM corporate HY default

(1-212) 834-9151

rate is 2.5% YTD vs. 4.3% forecast, leaving 1.8% — or about $9.6bn — to year- alisa.meyers@jpmorgan.com

end, which is conservative, given most bulky events have already materialized. We J.P. Morgan Securities LLC

keep our 2026 default forecast at 4.3%, but continue to see downside risks. The Dhawal U Mehta

thematic message remains unchanged: large realized candidates, limited (91-22) 6157 3779

unexpected additions, and no evidence of a generalized EM corporate default dhawal.mehta@jpmchase.com

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

concentration rather than contagion view. High-par vs. low-issuer-count default

rate dynamic is playing out as expected. Braskem and Raizen were the 8th and 13th

largest EM corporate defaults of all time, respectively, driving the YTD increase

in the par default rate without a broadening in the list of issuers facing credit events.

2H26 picture cleared materially, especially for Latin America. Latin America

YTD default rate is 6.2%; Braskem alone contributed 3.5% to LatAm and 1.3% to

Global EM HY default rate. We see limited remaining events that could take Latin

America toward ~7.0% by year-end, versus our 7.4% forecast. Outside Latin

America, the rest of the year looks relatively clean and dominated by modest-sized

liability-management situations.