December 15, 2022

Debt Download

Welcome to Debt Download, Goodwin’s monthly newsletter covering what you need to know in the leveraged finance market. Wishing you and your families a happy holiday!

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In the News

Goodwin Insights

In the inaugural edition of Debt Download, we covered recent trends in the U.S. debt finance markets. This month, we take a look at what’s happening in the U.K. and Europe.

  • Conditions in the U.K./European debt markets remain in their challenging post-summer mode with many investors risk off until the end of the calendar year (as has been the case for most of Q3 and Q4). Some smaller and middle market deals are still getting done, but more “creativity” and “flexibility” for both sponsors and lenders are the watch words in this space.
  • Activity is very muted in the broadly syndicated loan market and the high yield bond market, driven by fundamentals and a lack of CLO issuance, as European CLO new issuances are reportedly down almost 35% year-to-date.
  • Earlier today, the Bank of England and the European Central Bank raised interest rates by another 50 bps.
  • With an eye on 2023, bankers will be looking to place deals for credits with maturities running up in 2024 and 2025 – there is speculation that the market might resurrect the “forward start facilities”, which became briefly popular during the financial crisis as a way of locking in committed financings ahead of maturity.
  • There is generally no consensus view on the trajectory of the leveraged loan market in 2023 given the stressed macro environment (including persistent inflation in the Eurozone and the U.K.). Optimists will point to lots of dry powder at credit funds and other institutional investors – only time will tell. 

For inquiries regarding Goodwin’s Debt Download or our Debt Finance practice, please contact Dylan S. Brown, Nikolaus J. Caro, and Robert J. Stein.

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