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...These debts include mortgages and loans for cars, rental equipment and yachts....
...Many large private equity firms use whitelists....
...Castlelake has taken advantage of recent market turmoil to expand its credit portfolio beyond aircraft leases, buying up billions of dollars of consumer instalment loans from fintech group Upstart....
...Private credit has less than 5 per cent of these types of loans, mostly packaged for insurers....
...The investigation relates to a loan made by an Austrian private bank to Signa, said people with knowledge of the probe....
...They’re also backing this up with a relatively niche argument: The number of private-credit loans being refinanced in BSL markets vs BSL loans being refinanced in private credit markets: At first glance...
...At worst, it’s shows a central risk of private credit markets, and private markets in general: Too much creativity/optimism on loan valuations can leave investors holding junkier debt than they thought....
...A decade of easy money though has skewed negotiating dynamics more in favour of borrowers and their private equity backers....
...Private equity-owned German real estate lender Aareal Bank warned there was “more to come” after one in four of its US office loans went into default last year....
...For example, if a private credit fund owns a $150mm loan, funded by $100mm of investor capital and $50mm of external leverage, this would be counted as $100mm of assets, assuming the loan is valued at par...
...senior loans....
...As the market grows, investors are more actively trading private credit loans that are halfway to maturity (or longer)....
...Traditional private equity firms in the past five years have however raised mega private credit funds that can go head-to-head with the bank-originated syndicated loans extended to companies of in effect...
...loan....
...Equinox, the popular luxury gym chain, has raised $1.8bn from a group of private capital investors to refinance more than $1bn in loans and give it financial breathing room....
...So you’re now seeing more and more competition between banks and private credit for the business of lending to companies. And that’s leading to falling prices on loans....
...Banks provide financing for deals as well as arrange loan and bond offerings for portfolio companies owned by private equity groups to refinance debt, which generate lucrative fee streams....
...Private equity group Carlyle will take control of Southend Airport after sealing a deal to resolve a row over a loan made during the pandemic....
...Rover Group, in what would be one of the cheapest private credit loans on record… In response [to banks offering cheaper loans] private credit firms including Blackstone, KKR & Co., and HPS, among others...
...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....
...Perhaps it is time to cut private equity managers some slack. In recent weeks, these financial sponsor firms have been big borrowers in the leveraged loan market....
...Leverage — funds borrowing more money to make loans — adds risk, too....
...However, “repeated and continuing” breaches of contract meant Carlyle could “no longer wait patiently” for the loan’s repayment, the private equity group said....
...Some of the affected companies are looking at novel ways to refinance their debts, including “amend and extend” agreements that alter the terms of a loan and push out its repayment date....
...When private credit firms are willingly put up for sale, it is not unusual for a quarter of that firm’s loan book to be refinanced by rivals....
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