“2018 will be a good year for loans.”

Back in January, that was the way we characterized what to expect in leveraged loan land for the year ahead. At the half-way mark, our forecast seems to be holding true.

According to Thomson Reuters LPC, volume for the entire loan syndication market in the US hit $1.5 trillion for the first six months of 2018. That was the best half-time showing since last year, when activity was $1.3 trillion. This number comprised both investment and non-investment grade lending.

On the leveraged loan front, this year so far has been almost as active as 2017. Volume of $737 billion was the second highest ever only to last year’s $770 billion. Second quarter’s story, unlike a year ago, was more M&A-related. The share of refinancings has slowed as interest rates have risen.

A frothy M&A market combined with strong economic growth are two dynamic programs running in the background of loan formation. Dealogic has global deal activity running at $2.35 trillion through June 30; almost 60% higher than the same period in 2017. At that rate, 2018 will break the all-time 2007 record of $4.3 trillion.