October 20, 2016 - U.S. secondary loan trading volumes fell 12% during the third quarter to $141 billion. This is not a big surprise given the seasonality of third quarter activity (over the past five years, volumes, on average, fell more than 10%). Moreover, last quarter’s $160.1 billion in activity represented a two-year high.
October 14, 2016 - On October 13th, the SEC voted to approve their long-anticipated Open End Mutual Fund Liquidity Risk Management Rules, which have the potential of profoundly impacting loan mutual funds. The 459-page rule was published last night. Today, we share our initial impressions. (Fair warning: we are still reading it.) For a deeper dive, we invite you the attend next Wednesday’s 4 pm ET webcast on The SEC’s Final Liquidity Rules and read a full analysis in next Friday’s Newsletter.
October 5, 2016 - The S&P/LSTA Leveraged Loan Index (LLI) has returned 7.7% on the year through September – the best performance since 2012. In September, the LLI gained 0.86% which raised 3Q’s total return to a four-year best 3.1%. In turn, the percentage of loans priced at a premium to par increased to a 14-month high of 37% (at the beginning of the quarter, par-plus market share totaled just 5%).
October 3, 2016 - In observance of Columbus Day, the Loan Syndications and Trading Association (LSTA) recommends treating Monday, October 10, 2016 as a loan market holiday for purposes of calculating delayed compensation under the LSTA standard forms of trade confirmation.
September 30, 2016 - The LSTA published a Market Advisory for Caesars Entertainment. The LSTA recently learned that, with respect to the Caesars Prepetition Credit Agreement, a cash payment of $300 million will be made on a pro rata basis to first lien bank lenders on October 3rd.