Borrowers and investors in the $1.4 trillion leveraged loan market are battling over the looming switch to SOFR from Libor, with buyers complaining that they don’t have a say on the new rates being applied. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie is joined by leveraged finance reporter Paula Seligson to detail what the switch means. Bloomberg Intelligence analyst Jaimin Patel also provides a status update on the Latin America energy sector.

Borrowers and investors in the $1.4 trillion leveraged loan market are battling over the looming switch to SOFR from Libor, with buyers complaining that they don’t have a say on the new rates being applied. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie is joined by leveraged finance reporter Paula Seligson to detail what the switch means. Bloomberg Intelligence analyst Jaimin Patel also provides a status update on the Latin America energy sector.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge by Bloomberg Intelligence

Libor-SOFR Switch Angst; LatAm Energy View

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/37687096-833d-40e1-80b0-afb8014e1eb2/transcript

A retail exodus from business-development companies has dragged their debt to levels that are starting to look attractive, according to MFS Investment Management. “Pressure for redemptions that they’re facing likely ends up creating some opportunities within the public credit markets,” Alex Mackey, the firm’s co-chief investment officer for fixed income, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Robert Schiffman in the latest Credit Edge podcast. “You can line up all the public and the private BDCs and you can go through and see which ones have the leverage metrics that are most attractive,” said Mackey, whose firm oversees $622 billion in assets. They also discuss the deluge of technology sector debt issuance and how wide credit spreads would have to go before they’d look attractive.

A retail exodus from business-development companies has dragged their debt to levels that are starting to look attractive, according to MFS Investment Management. &ldquo;Pressure for redemptions that they&rsquo;re facing likely ends up creating some opportunities within the public credit markets,&rdquo; Alex Mackey, the firm&rsquo;s co-chief investment officer for fixed income, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Robert Schiffman in the latest Credit Edge podcast. &ldquo;You can line up all the public and the private BDCs and you can go through and see which ones have the leverage metrics that are most attractive,&rdquo; said Mackey, whose firm oversees $622 billion in assets. They also discuss the deluge of technology sector debt issuance and how wide credit spreads would have to go before they&rsquo;d look attractive.

BDC Bond Bust Creates Opportunity for $622 Billion Asset Manager MFS

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/8de578e8-df56-4b62-af28-b427014a3f38/transcript

Business development company turmoil is making direct lenders cautious on corporate debt risk, according to PGIM, which oversees more than $200 billion in private credit. “It’ll have a bit of a chilling effect,” Matt Harvey, the firm’s global head of middle-market direct lending, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Matthew Geudtner in the latest Credit Edge podcast. “As a lender you’re a little bit more conservative, you’re a little bit more rational in terms of your view on how to structure the asset, how to price it,” Harvey says. They also discuss default rates, loan marks, the consumer staples sector and relative value in European direct lending.

 

Business development company turmoil is making direct lenders cautious on corporate debt risk, according to PGIM, which oversees more than $200 billion in private credit. &ldquo;It&rsquo;ll have a bit of a chilling effect,&rdquo; Matt Harvey, the firm&rsquo;s global head of middle-market direct lending, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Matthew Geudtner in the latest Credit Edge podcast. &ldquo;As a lender you&rsquo;re a little bit more conservative, you&rsquo;re a little bit more rational in terms of your view on how to structure the asset, how to price it,&rdquo; Harvey says. They also discuss default rates, loan marks, the consumer staples sector and relative value in European direct lending.
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PGIM Sees 'Chilling Effect' on Private Credit From BDC Storm

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/a189fcba-e332-458d-a360-b42001375f4a/transcript

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The plunge in software debt creates opportunities to buy cheap loans from companies that will survive AI disruption, according to Permira Credit. “The market has overreacted,” Ian Jackson, the firm’s head of strategic opportunities, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Tolu Alamutu in the latest Credit Edge podcast. “The broad selloff in software has been such an interesting place for us because a lot of these names, we just don’t believe will go through restructuring,” says Jackson, whose company lends to technology companies. They also discuss fraud, private market stress, relative value in Europe vs. US credit and the outlook for collateralized loan obligations.

The plunge in software debt creates opportunities to buy cheap loans from companies that will survive AI disruption, according to Permira Credit. &ldquo;The market has overreacted,&rdquo; Ian Jackson, the firm&rsquo;s head of strategic opportunities, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Tolu Alamutu in the latest Credit Edge podcast. &ldquo;The broad selloff in software has been such an interesting place for us because a lot of these names, we just don&rsquo;t believe will go through restructuring,&rdquo; says Jackson, whose company lends to technology companies. They also discuss fraud, private market stress, relative value in Europe vs. US credit and the outlook for collateralized loan obligations.

European PE Giant Permira Looks to Buy Beaten Up Software Loans

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/60b45911-8f1d-42a9-ab2e-b41900f4820c/transcript

Libor-SOFR Switch Angst; LatAm Energy View

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