To get a better handle on the total universe of middle market loans, let’s define what we mean by the middle market.

Should we include, for example, both non-sponsored as well as sponsored loan volume? Thomson Reuters LPC estimates there’s been an average of $100 billion in annual non-sponsored activity since 2000. But these financings tend to be working capital driven with more than 70% comprised of revolving credit capacity. That results in the relatively modest $30 billion of yearly funded debt.

Also, many non-sponsored loans fall under the heading of C&I loans by commercial banks. To accurately assess the extent of these holdings would involve reviewing things like Shared National Credit reports – an effort beyond the scope of this exercise. For simplicity’s sake, let’s confine our study to PE-backed leveraged loans.

As our Chart of the Week shows, annual sponsored volume according to LPC generally hovers around the $100 billlion mark, though now at a $140 billion pace for 2017. This includes both syndicated (“league table credit”) and clubbed/sole lender transactions from arrangers who report to LPC’s Private Deal Analysis survey.