Global volatility hits leveraged debt

摘要

The global leveraged loan market has been hit hard and fast by wider capital markets volatility. Massive outflows from US high-yield bonds in recent weeks have prompted a pricing correction in US loans, which is filtering through globally and has led to a raft of deals, including a high-profile US$3.9bn M&A loan for CHARTER COMMUNICATIONS, being postponed until September or sweetened to sell. Where the US leads, Europe and Asia tend to follow, as foreign companies have been raising funds in the huge, liquid US TLB market, which has offered more favourable terms for the past two years. Deals have been delayed worldwide and pricing and discounts have widened,eating into lead banks' profits, as borrowers and arrangers gamble that market conditions will be better in September.