The new issue European high-yield bond market surged in 2004,
continuing the strong growth that it experienced the previous year.
In 2004, European issuers issued $27.1 billion equivalent of new
high-yield bonds. These bonds were sold in 101 separate issues.
That smashed the previous record of $19 billion of high-yield bonds
issued in 2003. By comparison, in 2002, European companies issued
only $5.3 billion in 25 issues.
2005 is already off to a strong start. The first two months have
witnessed record high-yield issuance in Europe.
This record number of issuances has been driven by the
eye-opening performance of European high-yield bonds. After losing
money for three consecutive years (2000 to 2002), an index of
European high-yield bonds returned an astonishing 30.89% in 2003.
That pace moderated in 2004, with the same index growing a
respectable 13.82%, making European high-yield one of the best
performing asset classes over the last two years....