Tumbling volatility over the past months has seen US and European corporate credit risk converge, despite credit investors bracing themselves for diverging monetary policies. In a speech yesterday, Fed chair Janet Yellen remained positive about an interest rate hike in the coming months, while tomorrow marks the start of the ECB’s corporate bond buying programme….
Large arrangers have gained enough confidence to arrange and syndicate second lien facilities this quarter in the leveraged loan market. So far in 2Q16, US$2.4bn in second lien tranches have closed, a 60% improvement from the US$1.52bn last quarter. And several second liens have even been used to finance dividend recaps – a testament to…
Median healthcare buyout size surges in 1Q In the first quarter of 2016, the median private equity buyout in the U.S. healthcare sector hit $139.3 million in size, topping the previous high of $123 million in 2012. Even if 2016’s numbers slide as the year goes on, transaction sizes shouldn’t decline by much, owing to…
Brexit fears jolt sterling bond liquidity As the UK’s EU referendum approaches, associated uncertainty has seen risk in the sterling corporate bond market rise, with liquidity taking a blow. Sterling corporate bonds have seen credit spreads underperform euro peers so far this year Sterling corporate bond liquidity deteriorated in March, at the height of Brexit…
According to Thomson Reuters LPC’s year-end survey, the majority of buyside and sellside institutions surveyed estimated that roughly 40% of managers had a Risk Retention solution in place. Maybe not quite put the structure and funding in place but as we approach December 24th, managers have not just been evaluating the various solutions out there,…
Another year of record PE distributions back to LPs? 2014 saw a mammoth $463.6 billion returned back to limited partners by private equity fund managers, capping off several years of steady increases in the annual total of distributions. But at $342.0 billion through the end of September, PE distributions in 2015 already look set to…
Securitised peer-to-peer loans see risk escalate Recent troubles at Lending Club have only compounded risk in the peer-to-peer credit market P2P backed loans were introduced in 2014 and saw spreads fall to lows in mid-2015 Average spread on senior P2P loan backed securities has widened 76% since last October Markit Liquidity score among P2P securities…
Downward flexes continue at the forefront of flex activity so far in May. There have been three times more downward price flexes than upward price revisions this month. However, with nine downward flexes so far, May is trailing the 24 price cuts tracked in April. Terms continue to favor issuers this quarter, and at 33…
Recent PE Funds Have a Head Start As is to be expected, private equity funds of all vintages and geographies see their average distributed-to-paid-in multiples climb over time, as managers successfully liquidate even aging holdings after years of operational enhancements. The rates of increase in DPI multiples by vintage, however, can be split into two…
European hybrid bonds continue to underperform Idiosyncratic risk in the European corporate hybrid bond sector has seen new issuance stall and credit spreads rise. European Hybrid bonds have underperformed their senior counterparts over the last year Idiosyncratic risk has been key driver, with Volkswagen and Total seeing spreads widen Markit iBoxx EUR Liquid High Yield…