Distressed Nations Are Bearing the Brunt From Bank Turmoil (1)

Bond markets in some of the world’s most vulnerable economies are flashing default warnings as turmoil in the US and European banking systems makes it even tougher for fragile emerging nations to borrow and repay debt.

Countries that have been tottering on the brink of default have shouldered the brunt of a selloff in emerging markets this month, sending yields toward unprecedented levels. The fallout from a series of banking failures in the US forced a rescue of Swiss lender Credit Suisse Group AG in Europe and sent investors fleeing from the riskiest assets worldwide.

From Pakistan to Bolivia, ...