U.S. leveraged lending, at US$112bn in 1Q16, was down 29% from 4Q15 Instability in oil prices and credit concerns in energy and metals and mining, coupled with worries that slowing global growth could impact the U.S., amplified what was already shaky sentiment heading into this year. Although seeing opportunities, some distressed funds waited to pull…
Returns on US dollar denominated emerging market (EM) bonds have outstripped developed nation peers so far this year, as confidence in the region has returned after market volatility in late 2015. Since January 2016, dollar denominated EM sovereigns and corporates have returned 4.3% and 3.2% respectively, according to Markit’s iBoxx indices. The returns surpass those of…
1Q16 US Syndicated loan volume tumbles 19% y-o-y; Down a more substantial 37% q-o-q US syndicated loan volume took a tumble in 1Q16 to log just over $310 billion, down 19% compared to year ago levels and a more substantial 37% drop over 4Q15 totals. Surprisingly, the decline was most notable among investment grade issuers who…
As Investment Activity Slows, Competition for Quality Remains Fierce As March winds down, the first quarter of 2016 currently has seen around 700 private equity deals close in the U.S. Taking the total as 700, that completed deal count represents a drop of nearly 29% from the tally of 4Q 2015, which itself saw the…
Valeant Pharmaceuticals, the most widely held name in U.S. CLOs, announced last week it was cutting its revenue forecast and that a delay in filing its annual report put the company at risk of defaulting on its debt. In response, Valeant’s shares plunged by more than 50%. The company’s loans ended Tuesday with a weighted…
Will Net Cash Flows Decline for PE Fund Investors? Since 2010, there has been a markedly recurrent yearly increase in total distributions to investors in private equity funds. This increase, as well as relatively plateaued contributions, has produced a significantly positive net cash flow for global PE funds. Through the first half of 2015, net…
Investors embrace HY ETFs as sentiment turns High yield credit has enjoyed a sustained rally over the past five weeks and investors have taken advantage through ETFs. High yield bond ETFs have seen five consecutive weeks of positive inflows Markit iTraxx Europe Crossover index has seen its spread fall from 486bps to 332bps Oil &…
The equity, bond, and loan markets have all rebounded from their February lows as investor sentiment has improved. Multi-quote institutional loan bids are now at 92.24, up from a low of 90.48. High yield bond prices have posted a relatively bigger bounce, jumping 6 points from their low in February to an average of 90….
PE funds from Recent Vintages Outpacing Those Hit by Financial Crisis The ramifications of the financial crisis are still apparent in the numbers posted by private equity funds. Let’s take DPI multiples as a sample metric for now; for vintages most affected by the crisis—2005, 2006 and 2007, as indicated above—the deleterious effects… Subscribe to
Investors have been flocking to government bond ETFs at a record pace since the start of the year, hoping to shelter from the surge in credit risk and profit as the market discounts the probability of nearing interest rate hikes. This has so far proved profitable as global government bonds have largely outperformed their corporate…