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...PetVet’s decision to start discussions with direct lenders over its loans comes on the heels of a string of other large refinancings....
...But four people with direct knowledge of the case told the Financial Times that it was Morgan Stanley....
...Borrowers in private-credit markets, on the other hand, have a direct relationship with a smaller group of lenders....
...The largest US banks lent billions of dollars less in the first quarter, in a sign that corporate borrowers are paying down debt as interest rates hover at historically high levels....
...Private credit is typically floating rate and caters to relatively small borrowers with high leverage....
...Roughly $10bn of so-called private credit loans have been refinanced in public markets, as borrowers pay down burdensome loans in favour of a cheaper alternative, according to data from Bank of America....
...missing a coupon payment to borrowers....
...This possibility might derive from, variously, the fact that some borrowers will pay up to avoid public bond and loan markets; tighter contract terms; tighter bilateral relationships between borrower and...
...It is better for the borrower to be able to buy a car, even with a high-interest rate loan, than to be turned away, given how important it is to employment to have a vehicle in so many parts of the country...
...Now CreditSights says that a handful of banks — including JPMorgan, Goldman Sachs and Barclays — are “leading the way” in liquefying the market for these private direct loans....
...In a series of 2023 deals, struggling companies that had traditional syndicated term loans coming due found a lifeline in private credit funds....
...One in two of these so-called unserved borrowers have used BNPL compared with one in three people who have access to regulated loans....
...They often maintain a crucial underlying relationship with companies and borrowers....
...Americans have run through their savings and are falling behind on their loans....
...Data shows that this direct lending market now has $800bn of assets under management, compared to about $1.4tn of syndicated loans outstanding....
...These hedge funds, private equity firms, direct lenders and others use the money to leverage investments and increasingly lend it out to a range of risky borrowers that regulators have discouraged banks...
...If anything, and as we discussed in our last Private Credit Monitor, we see several reasons why losses on direct loan portfolios will likely peak at lower levels vs. the broadly syndicated loan market....
...Roughly $10bn of so-called private credit loans have been refinanced in public markets, as borrowers pay down burdensome, high interest loans in favour of a cheaper alternative, according to data from Bank...
...Real estate markets also face unique challenges: $3.6 trillion of commercial real estate (CRE) loans are maturing in the U.S. and Europe through 2025, many of which may not qualify for extensions....
...The effective interest rates on CDB debts have consistently been over 3 per cent during 2014-2021: lower than on Sri Lanka’s Eurobonds, but higher than the cost of loans from China EXIM, which receives direct...
...The company, which levered up when interest rates were low to buy non-performing loans, will get €0.7bn of cash, an equity stake in the new vehicle and a five-year contract to service the assets....
...Borrowers are struggling to refinance or sell their properties. At NYCB, over two-thirds of its $18.2bn NYC rent-regulated loan book is due to mature between this year and 2027....
...Heavier demand for syndicated loans helps investment banks compete with direct lenders on price....
...Leverage — funds borrowing more money to make loans — adds risk, too....
...Rents earned by the funds from making private direct loans accrue to the general partners, not the limited partners....
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