We will be starting the new year with a bang, kicking off next week our first “Lead Left Presents” webinar. This debut session will feature top middle market investment bankers discussing what happened in the deal market in 2021 and what’s to come for 2022. So much attention has been paid to record financings and…
We planned last year to publish a special series on Environmental, Social and Governance (ESG). Unlike most topics in our commentaries, the origins and complexities of ESG were unfamiliar. To the rescue came our Nuveen colleagues, a Responsible Investing team of close to thirty ESG professionals. Of course, risk management is core to Churchill’s own…
Inflation and interest rates are linked, but not always in straightforward ways. Fear of higher prices can drive rates up, while markets may ignore actual inflation having anticipated it. This year we devoted a special series to inflation (link) and, with expert help from our favorite economists, have written extensively about rate expectations. Recent data…
Back in 2015 we introduced the concept of the “cargo-pants strategy” [link]. It was our observation that direct lenders saw the opening to compete against banks for leveraged finance deals, but needed virtual balance sheets to hold larger commitments. Over time these managers raised multiple vehicles – CLOs, separate managed accounts, commingled funds, BDCs, etc….
At recent private credit conferences we’ve been asked how managers think about portfolio construction. The answer depends on your experience over the past twenty-two months. Covid clearly threw a wrench in investors’ business assumptions. As one private equity partner told us, “we had a base case and a down-side case, but we didn’t have a…
Thanksgiving week in the US capital markets is always a mixed blessing. A wonderful time for families and friends, celebration and gratitude. Yet it’s also smack in the mad year-end rush. Everyone juggling deals and holiday get-togethers – and all running on fumes. Six weeks before, incredibly, it starts all over again. What will deal…
As investment managers run through the tape towards an incredibly productive 2021, many are now looking ahead to 2022. What will the new year bring? Two years ago no one could have foreseen the imminent downturn or the agent that caused it. Nor one year ago were the course of the pandemic, vaccines, or 25%…
Our friends at William Blair ended their 3Q survey [link] with a summary of issues most expected to impact leveraged loans through year-end. Here’s a sampling: Supply/demand equilibrium. Which comes first, supply or demand? Retail cash inflows and CLO capacity largely drive liquid loan demand. Once issuers see there’s investor appetite, they hit the market…
Having moderated three private credit panels in the past ten days, a recurring theme is the record level of deal volume. What’s driving this unprecedented activity? In its recently published 3Q survey [link], William Blair reported $155.3 billion of institutional loans, nearly the highest number they’ve recorded. Almost 60% – $92.4 billion – was dedicated…
We report (in person!) this week from the SuperReturn Private Credit conference in Chicago, where we chaired day one, moderated an LP panel, and interviewed the keynote speaker. The event always attracts top-shelf credit investors and managers, and 2021 is no exception. Sifting through sentiments on the economy and markets from various panels, we discovered…