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Brazos Becomes Rare ‘Failing Angel’ After Texas Storm Bankruptcy

  • It’s the first investment-grade company to file since PG&E
  • Climate change seen as a growing risk to company debt loads

Brazos Electric Power Cooperative joined a rare club of investment-grade companies that filed for bankruptcy after the Texas power firm collapsed under a brutal winter storm, highlighting the growing risk of climate change.

In Wall Street parlance, they’re known as “failing angels,” a play on the more common “fallen angels” tag for debt issuers that get downgraded to junk. In those cases, managers still have time to turn things around, and investors who can’t tolerate the risk have months or years to get out. For companies like Brazos that get caught in sudden calamities, the fall from grace can be a matter of days.