PALM BEACH GARDENS, Fla, May 1, 2002 - Seventy-one publicly traded companies¹ filed for bankruptcy in the first quarter of 2002 due primarily to excessively high levels of debt, according to Weiss Ratings, Inc., the nation's leading independent provider of ratings and analyses of financial services companies, mutual funds, and stocks.

"The handwriting was on the wall in big bold letters, months in advance at every one of these companies, especially the giants like Kmart and Global Crossing." said Martin D. Weiss, Ph.D., chairman of Weiss Ratings. "And yet, major Wall Street firms continued to maintain 'buy' or 'hold' ratings for most of their shares, often until the bitter end."

If bankruptcy filings continue at the pace set in the first quarter, the number of public companies seeking protection under Chapter 11 or liquidating under Chapter 7 will remain high through the remainder of 2002, as illustrated:

Source: BankruptcyData.com and Weiss Ratings, Inc.

Of the 71 companies that declared bankruptcy in the first quarter of the year, 62 had publicly traded common stock. Weiss rated 36 of the 62 companies at least three months before the bankruptcy filing, assigning a "weak" or "very weak" Weiss Investment Rating to 94% of them. Moreover, Weiss identified 100% of these stocks as having a high level of risk at least three months before the filing.

Steel, Auto Parts & Equipment, and Wireless Telecom Sectors Look Most Vulnerable

Looking ahead, Weiss finds that the sectors most vulnerable to continuing bankruptcies are steel, auto parts and equipment, and wireless telecommunications. Companies within these sectors receiving a poor overall Weiss Investment Rating based on March 31, 2002, data include:

Companies Receiving Poor Weiss Investment Ratings

"Investors holding shares in companies that go bankrupt usually suffer a total - or near-total - loss, even if the company subsequently re-emerges from Chapter 11," added Dr. Weiss. "Investing in today's uncertain times without an independent evaluation of the company's prospects is like playing Russian Roulette."

The Weiss Investment Rating is a composite evaluation of both risk and performance. By applying its conservative approach to ratings and factoring in risk, Weiss effectively captures the risk/reward trade-off of an investment. Weiss reviews more than 9,000 stocks, including all those traded on the New York Stock Exchange, the American Stock Exchange, and Nasdaq.

Weiss also issues investment ratings on over 11,000 mutual funds, covering both equity and fixed income funds, and provides financial safety ratings on over 15,000 financial institutions, such as banks, insurance companies, and brokerage firms. Weiss Ratings is the only major rating agency that receives no compensation from the companies it rates. Revenues are derived strictly from sales of its products to consumers, businesses, and libraries.

¹Companies that have publicly traded common stock and/or corporate bonds outstanding.