Highly levered middle market issuers could struggle if rates continue to rise Throughout most of this credit cycle, the Libor benchmark rate has remained extremely low making it quite easy for issuers to meet interest payments. However over the past year, three-month libor has risen over 100bps to 2.75%. While the Fed has recently tempered…
Unitranche volume reached $7.5B in 4Q18 and $27B in 2018 LPC tracked US$7.5bn in unitranche facilities closed in 4Q18, down slightly from the US$8.9bn tracked in 3Q18, but still quite robust. For the 2018 year, LPC tracked US$27bn in unitranche facilities closed, 13% higher than 2017’s levels. As many direct lenders continued to amass scale…
Non-sponsored middle market lending increased to US$102bn but new money collapsed The non-sponsored market continued to tread along in 2018. Issuance was up for the second year in a row to US$102.3bn, but that was still far from 2014’s record and was driven by increased refi activity. Refinancing volume of US$81.3bn, was up 36% from…
2018 US M&A loan volume sets new record at over US$648Bn At over US$648bn, US syndicated M&A loan volume set a new record in 2018, topping 2017’s high of US$537bn. The strong results were spread across market segments as corporate issuers looked to augment organic growth with strategic acquisitions and private equity sponsors aggressively looked…
Discounts widen as volatility hits the primary loan market Loan market sentiment has shifted dramatically this quarter as broader market volatility sent waves into the leveraged loan market. Concerns about global growth, trade wars, Brexit worries, and uncertainty over future interest rate hikes have cast a shadow on confidence and investors are a lot more…
Loan bids continue to decline amidst broader market volatility LPC’s most liquid 100 loans cohort traded down again yesterday to 96.15, its lowest level since March 2016. The volatility in the broader market has bled into the syndicated loans market. Loan investors have reacted by yanking roughly US$5.6bn from retail loan funds since the last…
MM cov-lite issuance of $22B YTD slightly behind 2017’s record high Year to date middle market covenant lite volume has reached US$22bn. This is only about 11.5% behind 2017’s all time record high of US$25.1bn, making 2018 the second highest year on record. Much of 2017’s strong momentum carried over into 2018 with 1H18 issuance…
MM sponsored spreads not yet showing impact of leveraged loan volatility Whenever volatility and investor pushback strikes the leveraged loan market, it always takes time for those effects to move down into the less liquid middle market. The average bid on the 100 most liquid loans has been grinding down for most of November, hitting…
US M&A loan issuance continues at a healthy pace this quarter At around the halfway point in the quarter, US M&A activity has remained busy. Through November 14, there has been US$71bn in completed leveraged M&A issuance and US$10.6bn in completed non-leveraged M&A issuance…. Subscribe to Read MoreAlready a member? Log in here...
Combined AUM surpassed $750bn for U.S. CLOs and retail loan funds CLOs manage roughly half of current institutional loan outstandings with retail loan funds managing an additional 14%. Their respective shares have been steady, hovering around these levels since mid-2015 when CLOs first reached a 50% share of outstandings. Meanwhile, the pie has certainly grown…