Catalyst Paper mill at Crofton, B.C.
To save yourself the stress of a debt default, steer clear of the resource sector.
Since the Canadian economy really started to recover from the financial crisis, there have been 16 debt defaults across the country, according to credit rating agency Moody's Investors Service. Of these, over 40 per cent have come from resource-related companies.
To compare, the banking, technology and transportation sectors haven't seen a single default since 2010.
The figures come from Moody's' latest report on Canadian defaults and recovery rates, which tracks who has defaulted, and how much investors are likely to get back in such an event.
Overall, Canadian debt has performed much better since the crisis. In 2008 12 different companies defaulted, and in 2009 16 companies saw the same fate. After the volume of defaults fell to 7 in 2010, the past three years have seen just three defaults each. In the quarter-century that Moody's has been tracking Canadian stats, there have only been two years when no defaults have occurred – 1996 and 2006.
Since 2010, Calgary-based energy company OPTI Canada holds the record for the biggest default, which amounted to $2.6-billion. Other resource-related defaults came from Catalyst Paper, which dealt investors the same agony twice in that time frame, and Compton Petroleum Corp.
While it's easy to call out resource companies, they haven't always been in the bad books. Dating back to 1989, telcos have also been big troublemakers, with defaults totalling $27.4-billion. The sector can blame AT&T Canada and Teleglobe for a good chunk of its bad rap. Both companies defaulted with $5.6-billion and $5.1-billion worth of debt affected, respectively.
And in the past four years, notable non-resource defaults came from Gateway Casinos & Entertainment Inc. and Yellow Media Inc.
Editor's note: The percentage of debt defaults from resource-related companies has been changed in the online version of this story.
Tim Kiladze