Senior Secured Bonds + Yes

4) the prevailing credit spreads at the time of default, and 5) the market-to-book ratio of the firm and its industry prior to default. The results of this study show that seniority and security are the two most important factors that impact recovery rates, followed by debt-cushion, leverage and asset tangibility. Industry and macroeconomic factors are also found to be correlated with recovery rates, sometimes very strongly. The following table, which is derived from a regression of a large number of dummy variables against recovery rates, provides a summary of the findings. Determinants of Recovery Rates on Defaulted Bonds and Loans for North American Corporate Issuers: 1983-2003 Summary This Special Comment explores the determinants of recovery rates on defaulted loans and bonds for North American corporate issuers over a period of 21 years (1983-2003). The variables it examines include seniority, security, type of initial default event, and a wide variety of firm-specific, industry-specific, and macroeconomic factors. The report esti-mates their influence on recovery rates both through univariate analysis, presented in a tabular form, and through mul-tivariate regressions