Fundraising falls flat There’s been talk of a modest revival in capital raising this year, but the first quarter may have lowered expectations. After a difficult time on the fundraising trail in 2023 as limited partners suffered from the denominator effect and lack of distributions, private debt managers were looking forward to a more benign…
Leverage declined for both direct lending and syndicated deals in 1Q24 Total leverage on sponsored middle market deals ticked down to 4.44x in 1Q24, driven by a drop in first lien leverage. First-lien leverage came in at 4.20x in 1Q24, down from 4.33x in 4Q23, while junior leverage in contrast increased modestly to 0.24x from…
The relative attractiveness of alternative asset classes has shifted significantly over the past few years as interest rates have risen and the economy become much less certain…. Subscribe to Read MoreAlready a member? Log in here...
US sponsored middle market direct lending volume fell by 10% in 1Q24 Overall sponsored middle market loan volume fell by 6% to US$31.7bn in 1Q24, though it still represented a 46% gain year-over-year. Breaking out this activity, direct lending deal flow amounted to US$22.8bn in 1Q24 versus US$8.8bn of syndicated deals…. Subscribe to Read MoreAlready
How Does the Default Outlook for the Middle Market Compare to BSL? Download FitchRating’s Report here. The default rate for loans in Fitch’s U.S. Leveraged Loan Universe was 3.3% at the end of 2023, in line with our forecast of 3.0%-3.5% and up from just 1.6% the previous year…. Subscribe to Read MoreAlready a member?
Refinancings redefine the direct lending market, claim 36% share in 1Q24 TTM Default Volume, Count Refinancings claimed 36% of 1Q24 direct lending volume in the US, the largest share of all proceeds, and the second-largest quarterly share for refinancings, behind the 41% in third quarter last year as tracked by KBRA DLD. Prior to 3Q23,…
LPs keen to address under-allocations The latest version of PDI’s Investor Report shows many investors have a long way to go to reach target exposures in private debt – but the intent is there. Private debt, along with other alternative asset classes, found last year to be a tough one on the fundraising trail –…
1Q24 ABL loan volume down 76% year over year at US$15bn US lenders completed US$15bn of asset based loan volume in 1Q24, marking the lowest quarterly total since 3Q20 during the height of the Covid pandemic and a 76% drop in issuance year over year…. Subscribe to Read MoreAlready a member? Log in here...
The investor view from Asia The need for income and the attractive risk/return profile of senior strategies are among the reasons why private debt is popular among LPs based in APAC. Private Debt Investor’s recent APAC Forum in Singapore featured many views and insights from leading investors in the region. As our chart shows, appetite…
How Do Covenants for Private Credit Loans Compare to Broadly Syndicated Loans? Download FitchRating’s Report here. While liability management exercises (LMEs) are not necessarily prohibited in direct lending documents, they are considerably less common than in the BSL market. We have yet to observe LMEs in the private credit portfolio rated for asset managers…. Subscribe