Convertible issues are in decline, says S&P

Only $51bn in convertibles was issued in the first half of 2002, a 39% decline on the $83bn issued in the first half of 2001, according to Standard & Poor's.

But the debt is being issued in ever-larger tranches, with the average issue size rising to $336m, compared with $330m one year ago and $222m in 1999.

Even though equity market volatility has not dissipated and interest rates remain relatively low, the appetite for convertibles has dulled, according to S&P's report.

The ratings agency put t