Got Covenants? Over half of all outstanding leveraged loans have no maintenance covenants, affording significant protection to those issuers in a downturn. Source: S&P Capital IQ LCD… Subscribe to Read MoreAlready a member? Log in here...
Rhymes, Not Repeats While growing over the past four years, the share of post-crisis buyouts with hyper-leverage and weak coverage metrics pales in comparison with the heady pre-crisis days…. Subscribe to Read MoreAlready a member? Log in here...
Not For Sale Leveraged buyout activity since the credit crisis has been muted, though 2014 volume could be best since 2006…. Subscribe to Read MoreAlready a member? Log in here...
Prime Targets Retail loan funds have suffered outflows 14 of the past 16 weeks, shrinking net additions to $765 million so far this year, compared to $30 billion for the same period last year…. Subscribe to Read MoreAlready a member? Log in here...
Tale of Two Vintages By one measure – public-to-private buyouts – today’s market is non-existent relative to pre-crisis levels. But sponsor-to-sponsor deals and corporate spin-outs are at a record pace…. Subscribe to Read MoreAlready a member? Log in here...
Treble Ahead New providers of triple-A CLO liabilities are expected to help tighten spreads to 135-140 bps by year-end. Beyond that, uncertainty on vehicle structures could reverse that trend…. Subscribe to Read MoreAlready a member? Log in here...
Arbitrage This While yields for middle market loans have generally contracted over the past four years, the cost of triple-A liabilities for middle market CLOs has been range-bound at L+175, about 25-50 bps higher than their BSL equivalents. MM Loans vs. MM CLO AAA Spreads… Subscribe to Read MoreAlready a member? Log in here...
Two-Bit Performance While two quarters does not a full year make, CLO issuance for 2Q this year will be the best second quarter in loan market history. That would beat 2007’s record of almost $33 billion, when annual volume hit just under $105 billion…. Subscribe to Read MoreAlready a member? Log in here...
Outer Banks US banks have surrendered share of the institutional loan market to their shadow selves for decades, but CLO’s, hedge funds, finance companies, and other institutional funds are poised to finish the job in the wake of increased regulation. Primary Market for Highly Leveraged Loans… Subscribe to Read MoreAlready a member? Log in here...
CLO 1.0, 2.0, 3.0…and Counting Loan securitization managers are sprinting to print new vehicles ahead of implementation of risk retention rules which are likely to inhibit future CLO formation. Sources: Thomson Reuters… Subscribe to Read MoreAlready a member? Log in here...