BMO Slashes Junk Debt Holdings as Geopolitical, Economic Risks Spread

BMO Asset Management, which oversees almost C$300 billion ($218 billion), has cut its junk-bond holdings and moved into safer parts of credit as geopolitical and macroeconomic pressures mount. “We love the movie — we’re still there — but we’re just getting a seat closer to the exit,” Earl Davis, th…

LBO Debt Coming Due Is Next Big Test for Credit Markets, Says ICG

Companies need to move fast to refinance leveraged-buyout debt coming due over the next few years, according to ICG. “Folks should start getting ahead of it because the traffic jam may be more the issue than anything,” David Saitowitz, the $126 billion global alternative asset manager’s head of US …

Investors Keeping Score on 'Bad PIK', Benefit Street Partners' Kumar Says

Investors are increasingly wary of lenders who dish out so-called bad PIK, or payment-in-kind interest, to help struggling portfolio companies avoid default, according to Anant Kumar, global investment strategist at Benefit Street Partners, the private credit arm of $1.7 trillion asset manager Fran…

Wellington Passes on Data Center Debt, Questioning Long-Term Value

Data-center debt returns are falling, risk is rising and there’s uncertainty over what the properties may be worth in the long run, Wellington Management says. “We think a lot about that replacement value when evaluating data centers,” Sonali Wilson, the $1.3 trillion manager’s lead investment dire…

Bull Run in Loans Slams CLO Equity Buyers, Says Eagle Point’s Majewski

Collateralized loan obligations face a second straight year of equity losses, according to Eagle Point Credit Management, a major buyer. “Where we stand right now, it’s certainly possible,” Tom Majewski, the $14 billion private-credit manager’s founder and managing partner, says in this episode of …

Sona’s CEO Sees ‘Exciting’ Growth in Asset-Based Finance, SRTs

Sona Asset Management is looking to expand its business in asset-based finance and significant risk transfers as public and private debt markets converge. “The thing that excites us the most is the scope for growth in ABF markets here in Europe,” Henrik Johnsson, the London-based hedge fund’s chief…

SpaceX Bondholders Face Huge Key Person Risk on Their Elon Musk Trip

SpaceX bondholders are bolstered by a fat equity cushion, high-grade ratings and a relatively small amount of debt outstanding — but they depend on founder Elon Musk, according to Bloomberg Intelligence. “There’s a huge risk there, and the rating agencies have actually pointed this out in terms of …

Europe's Largest Asset Manager Warns of AI Debt Deluge Crowding Out

Further acceleration in AI debt issuance has the potential to steer demand away from government bonds, according to Amundi, Europe’s largest asset manager. “At some point it could have a crowding effect, but we are not there yet,” Gregoire Pesques, the firm’s chief investment officer for global fix…

Real Estate Is Next Bet for Debt Investors Avoiding Private Credit

Private credit disarray spells opportunity for housing giant Pretium, which targets high returns by lending to US homebuilders. “Our private credit looks a little bit different than other private credit in the sense that we are secured, we have real good downside protection,” Jon Pruzan, the compan…

Oaktree Says Boring is Beautiful In Dicey Private Credit Market

Private lenders are going back to basics as debt trouble spreads, market participants tell Bloomberg News’ James Crombie in this special episode of the Credit Edge podcast. “Boring is beautiful, boring is better right now,” says Christina Lee, managing director at Oaktree Capital Management. The po…