Readers of The Lead Left will be familiar with our impatience for the “sky-is-falling” brand of financial industry reporting (“risky loans!”). Recent news articles have further tested us. There’s plenty of room for well-researched pieces about real risks associated with leveraged lending and sponsor buyouts. Indeed, these can be valuable by highlighting managers whose practices aren’t in line with the best performers in the business.

However, recent stories contain such a dizzying blend of inaccuracies and wild speculation, we want to highlight issues demonstrating almost willful ignorance of the role private credit plays in today’s asset management world. Or the less excusable desire to simply knock a fast-growing and popular sector.

Systemic risk! The kind of thing people throw around when they can’t identify specific concerns but want to grab headlines...

There’s no fear in the market.” – Matthew Tym, head of equity derivatives trading, Cantor Fitzgerald.

Featuring Charts

Chart of the Week: Refi Madness

March 19, 2024

The reversal of refinancings between direct lenders and the liquid market is dramatic. Source: PitchBook LCD(Past performance is no guarantee of future results.)

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Chart of the Week: Spready as She Goes

March 12, 2024

Despite modest spread softening, direct lending yields remain at record levels. Source: LSEG LPC(Past performance is no guarantee of future results.)

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Chart of the Week: Vehicle Sales

March 5, 2024

New CLO formation so far in 2024 has been the second fastest start ever. Source: PitchBook LCD (Past performance is no guarantee of future results.)

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Chart of the Week: Wait Expectations

February 27, 2024

Expectations for Fed rate cuts soften as the economy remains strong. Source: The Daily Shot(Past performance is no guarantee of future results.)

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Chart of the Week: Larger for Longer

February 20, 2024

Echoing dynamics in the loan market, corporate debt maturities have lengthened. Source: Bloomberg, Goldman Sachs Global Investment Research(Past performance is no guarantee of future results.)

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Chart of the Week: Four More Years

February 12, 2024

The bulk of private debt doesn’t start maturing until 2027, peaking in 2028. Source: KBRA DLD(Past performance is no guarantee of future results.)

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Features

Leveraged Loan Insight & Analysis – 3/11/2024

Nearly US$15bn of US LBO loan volume completed as BSL market strengthens The US BSL market has completed nearly US$15bn of loan volume backing sponsor buyout activity so far this year, up over 2.5 times year ago totals. The loan market as a whole has been more constructive early in 2024 with the buyer/seller gap…

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Private Debt Intelligence – 3/11/2024

LPs target private debt for reliable income streams Private debt investments provide LPs with reliable income streams through contractual repayments, which are particularly attractive in an uncertain macroeconomic environment. Portfolio diversification and high-risk adjusted returns were the second most common reasons cited by investors surveyed by Preqin for allocating to private debt…. Login to Read

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Middle Market & Private Credit – 3/11/2024

What Investors Want to Know: Middle Market CLO Manager Assessment Considerations Download Fitchratings’ Report here. Given the increased interest and overall expansion of the private credit sector, Fitch Ratings highlights key elements of its assessment of the capabilities of middle market (MM) CLO managers that are different (due to relevance) from that of a broadly…

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PDI Picks – 3/11/2024

Signs of hope in Asia-Pacific As the Middle East grows in significance as a source of capital and travel resumes post-covid, Asia-based GPs are hoping they can find backing for the region’s big investment themes.  It’s an arresting statistic: by 2050, more than half of the world’s GDP is expected to be accounted for by…

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Middle Market & Private Credit – 3/4/2024

Median Leverage and Coverage Fitch’s privately covered MM portfolio is comprised of generally smaller issuers (with average EBITDA of $55 million, average revenue of $296 million and average debt of $322 million). The portfolio is comprised of issuers in the b+* to c* range (asterisk denotes Credit Opinion)…. Login to Read More...

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Middle Market Deal Terms at a Glance

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Special Report: The Great Unwind

September 28, 2022

Beginning in July 2022 The Lead Left published a series of articles on credit market. This report consolidates those articles.

2022 Capital Market Outlook Report

February 3, 2022

Cov-lite trends Inflation & rising interest rates – LIBOR to SOFR transition Mega-tranche uni trend ESG takes center stage Login to view interactive report and download PDF version. … Login to Read More...

Special Report: Supply Chain Blues

January 6, 2022

Beginning in September 2021 The Lead Left published a series of articles on supply chain. This report consolidates those articles.