This week we chat with Mickey D. Levy, chief economist for US and Asia, Berenberg Capital Markets. Mickey is a long-standing member of the Shadow Open Market Committee and conducts research on a wide range of global economic, financial and policy issues. The Lead Left: Mickey, believe it or not, it’s been almost exactly one…
Five sectors comprise 60% of all middle market institutional loans.
Credit Strategies Asset Flows
Credit strategy hedge funds have recorded strong recent performance in 2016 YTD, making gains of 7.03% as of the end of October. Despite this, the strategy has struggled to attract investor capital, and suffered net outflows through the first two quarters of the year. This has led to a diminution of the strategy’s total assets under management (AUM) from the end of 2015, but net inflows in Q3 suggest that recent returns have been bolstering investor confidence
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Contact: Timothy Stubbs timothy.stubbs@spglobal.com
The European Commission announced on November 23 a banking reform package that will result in changes to the CRR and CRD IV capital requirement legislation, as well as changes to the BRRD and SRMR legislation relating to recovery and resolution of failing financial institutions. The package is very broad, so we won’t attempt to comment on all of the measures.
But one change under the BRRD caught our eye, as it will have a material impact on how the bond market – and possibly the CDS market - trades. The EC proposes a harmonised framework for bondholder hierarchy...
Primary yields widen slightly so far in November
Yields have widened slightly in November to the highest average since July. The average yield, assuming a three year term to repayment on first-lien institutional loans is in the 5.36% context so far in November, slightly up from 5.1% in October. Demand for loans remains strong, and some issuers continue to successfully tap the market to cut costs, but weaker credits are facing some pushback. In turn, the number of downward and upward price flexes are roughly the same so far this month. In contrast, downward price flexes outnumbered upward price revisions by 2.3 times in October...
Contact: Steven Miller smiller@covenantreview.com
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We’ve received a number of positive responses about our special series on add-ons. One partner at a NY-based private equity firm particularly liked our focus on why the right culture matters. “The key is retaining talent,” he wrote us. “Even when it’s not apparent where they’ll be a fit. We had one executive who had…