Pain across the board The covid-19 crisis has dished out equal treatment – hitting all types of sectors hard. The subject of the chart above is the CLO market, but it makes a point that is equally valid for the private debt universe. Not only have prospects for company default risen sharply in the wake…

Distressed debt takes centre stage A recent survey of investors by Oxane Partners found 42 percent said private credit attractiveness overall has decreased for the next 18-24 months while only 31 percent said it has increased, a net negative of 11 percent. But this loss could be distressed debt’s gain as investors show huge interest…

Strategic pioneers give fundraising a helping hand Outside of the mainstream, fund managers are seeking to take advantage of the dislocations produced by the global pandemic. In a way, all seems normal. Our latest data on private debt fundraising by strategy (see charts above) are not especially out of kilter with the norm. A slight…

Will coronavirus prompt a new wave of distress? One of the long-term impacts of the global financial crisis was a sharp uptick in non-performing loans as lax underwriting standards prior to the crisis and the global recession that followed created a perfect storm where over-levered borrowers were unable to repay their debts…. Subscribe to Read

Crunch time for the BDC market Current trading is looking bleak for BDCs, but they’ve come through even worse in the past. BDCs are expected to see significant write-downs and defaults on portfolio company loans because revenues collapsed in much of the economy. A decline in the net asset value of BDCs may end up…

The passing opportunity for direct lenders Companies that may have gone to the syndicated finance market are looking closely at more private alternatives. In Europe, a leveraged finance market which had effectively been on hold since the covid-19 outbreak emerged in March has been slowly waking up. But, as it does so, banks are beginning…

The biggest are the biggest for a reason Nothing much is predictable these days, but don’t expect the fundraising pecking order to change anytime soon. “Do what you can, with what you’ve got, where you are.” The inspirational quote comes from an autobiography of Theodore Roosevelt and surely resonates with anyone forced into lockdown as…

Private equity bandwagon rolls on, but for how much longer? Fundraising for the asset class was strong in the first three months of 2020 but continuing to defy the effects of covid-19 seems unlikely. As we have noted in this column over the last couple of weeks, private debt fundraising provides a neat reflection of…

The hidden attraction of distress They may not be raking in fresh capital right now, but distressed debt managers have plenty of firepower to take advantage of current conditions. In last week’s Lead Left column, we noted that the proportion of fundraising by strategy in the first three months of this year was more or…

Fundraising in the time of coronavirus Private debt funds are finding it tough to raise capital, but this was true before the virus struck. In the face of the coronavirus pandemic and the enormous disruption it has produced in its wake, little surprise that private debt fundraising appears to be in decline…. Subscribe to Read