We mentioned last week our turn at the SuperReturn North America Virtual conference. There we heard participants weigh in on various aspects of the pandemic on private credit, including impact on terms, structures and portfolio performance.
But what about new business? A lot depends on managers’ strategies. Over the past five years, institutional investors have expected a downturn. They pointed to various signs, including overleveraged borrowers and weakened covenants, suggesting excess in the loan market.
As time passed, significant capital was raised to take advantage of fall-out from a recession when it came...
“Even though employment is still rebounding, there’s still a long way to go.” – Michael Pearce, senior US economist, Capital Economics.
Featuring Charts
Chart of the Week: Dough Rising
Pent-up private debt appetite is driving third quarter fundraising, though mostly on the distressed front.
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Chart of the Week: New Loans Rising
Post-COVID direct lending spreads gapped out relative to middle market bank loans in the second quarter.
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Chart of the Week: Temp to Perm
As the pandemic wears on, workers suffering temporary layoffs have decreased, but permanent job losses are higher.
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Chart of the Week: Flights to Quality
Air travel has climbed back from the dark days of April, yet remains far below last year’s numbers.
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Chart of the Week: Sector Sightings
The mix of businesses represented by July’s direct lending activity skews to non-COVID industries.
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Chart of the Week: Buyout Bottom
In an inevitable result of COVID, middle market LBO loan activity slumped almost 80% from the previous quarter.
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The Pulse of Private Equity – 9/21/2020
Healthcare investment outpaces overall PE market PE activity in the healthcare space has outpaced the broader PE market since 2009. A new PitchBook analyst note, to be released tomorrow morning, chronicles the trend: tailwinds include an aging population, an uptick in global per capita healthcare spending, strong growth rates and attractive margin profiles, and a
View ArticleLeveraged Loan Insight & Analysis – 9/21/2020
Libor floors remain in institutional market, but are shifting lower One of the many effects brought by the pandemic was the precipitous drop in Libor rates, which had already been in a steady decline for a while. The average 3-month Libor rate dropped almost 100bp to an average of 0.58% in 2Q20 and is at
View ArticlePrivate Debt Intelligence – 9/21/2020
Private Debt-Backed Deals in Europe Despite the impact COVID-19 has had in deal activity, the European private debt-backed deal value has soared in 2020. A total of 79 deals were completed in H1 2020 (vs. 197 in 2019), for an aggregate value of €8.7bn....
View ArticlePDI Picks – 9/21/2020
NPLs: Covid-19 creates new round of buying prospects The coronavirus crisis may not be as bountiful for Europe’s NPL investors as the GFC, but will offer select opportunities. Every crisis has its winners and losers and one asset class which came out on top after the global financial crisis in 2008 was European non-performing loans
View ArticleLeveraged Loan Insight & Analysis – 9/14/2020
Middle market non-sponsored sydicated loan volume drops dramatically Middle market completed non-sponsored syndicated loan volume of US$7bn so far in 3Q20 is far behind the US$22bn logged in 3Q19 and is down from an already slow 2Q20. As the economy shut down due to the pandemic, activity in the non-sponsored market was very limited in
View ArticleMiddle Market Deal Terms at a Glance
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Review of Current Market Conditions/ Analysis of Capital Markets Metrics/ Review of Credit Quality/ Outlook for Third Quarter 2020
Beginning in May 2020 The Lead Left published a series of articles on high yield bonds. This report consolidates those articles.
Beginning in March 2020 The Lead Left published a series of articles on Covid-19 and the market. This report consolidates those articles.
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