Our studies indicate that in 2020, the deterioration in their financial situation will lead to a sharp increase in the probability of insolvency: the share of financial debt owed by the riskiest borrowers could exceed 20 per cent, compared with a prepandemic level of 13 per cent.
In the coming years, the evolution of firms’ riskiness will inevitably depend on cyclical developments, which are now extremely uncertain, and on the range and effectiveness of measures that may be introduced to encourage them to reduce their financial leverage.