Last fall we ran a special series on the size of the middle middle for loans (“How Big is the Middle Market”). This week we re-examine that question with Kelly Thompson, the middle market analyst for LevFin Insights.

In a recent report, Kelly discussed both the volume of middle market loan activity in 2017 as well as the supply/demand dynamics generating that activity. We caught up with Kelly this week to compare notes on these two important issues for lenders and investors.

“We measured $29 billion in sponsored loan volume in the middle market last year,” Kelly told us. “That’s not a bad number for any vintage. But middle market loans have become an institutional asset class in their own right. It’s becoming more difficult to sop up all that supply given the cash flowing into the market.”

How much are those in-flows? “Well, compare that $29 billion to the $43.2 billion in visible funds we (with our friends at Wells and Fitch) tracked last year across new-issue MM CLOs, credit funds and BDC equity raises. That’s a big gap of $14 billion.”

Ok, but as we covered in our series, there’s guesswork in both sets of numbers. “You’re right,” she said. “But first let’s talk