August 21, 2014, New York, NY – In observance of the U.S. Labor Day holiday, the Loan Syndications and Trading Association (LSTA) recommends treating Monday, September 1, 2014 as a loan market holiday for purposes of calculating delayed compensation under the LSTA standard forms of trade confirmation.
As the size of the secondary leveraged loan market continued to expand (S&P/LSTA Leveraged Loan Index outstandings grew to $774 billion), increased trade activity supported a larger and more liquid trading market.
On Friday, August 8, 2014, the LSTA's Model Credit Agreement Provisions ("MCAPs") were published. These revised and expanded MCAPs now address (i) how to handle entities which are considered to be disqualified institutions and how/when related disqualified lender lists should be shared with lenders and prospective buyers ("LSTA DQ Structure"), (ii) loan buybacks by the borrower and affiliated lenders, (iii) refinancings and cashless rolls (click for the LSTA's new Form of Cashless Roll Letter Agreement), and (iv) amend & extends.
As geopolitical fears rise over Russia, Israel and now Iraq, the risk-on trade has seemingly been taken off the table; at least temporarily. Investors around the globe have flocked to safer assets (the U.S. 10-year yield fell two basis points to 2.39% and touched 2.35%, the lowest since June 2013) as $1.8 trillion has been erased from the value of equities worldwide in the past two weeks.