After slumping for much of the second half, loans caught a bid in mid-November and rallied through December. The reason was partly technical. Net priced volume slowed to an 11-month low of $11.0 billion in December, according to LevFin Insights.
| File | Covenant-Review-TrendLines-January-2020.pdf |
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Membership in the LSTA offers numerous benefits and opportunities. Chief among them is the opportunity to participate in the decision making process that ultimately establishes loan market standards, develops market practices, and influences the market’s direction.
Today the LSTA published a new addition to its document library – the LSTA’s Form of Credit Agreement – Investment Grade Term Loan. This form is designed for a standalone term loan for investment grade borrowers.
The IG Term Loan is a standalone term loan designed for investment grade borrowers. It was modeled on the LSTA’s Investment Grade Revolver and is now the LSTA’s second complete credit agreement.
Changed pages from the Exposure Draft circulated on December 19th
A short one this week: one article on the borrower’s arguments for “hardwired” LIBOR fallbacks, and another article on the latest in what the LSTA is doing in the ESG space. Oh–and a friendly reminder to treat MLK Day as a holiday for delayed comp purposes.
Today, the LSTA hosted a webinar, “Brexit: Britain to Withdraw on January 31st”, presented by Clifford Chance Partner, Simon Crown. The UK has been stuck in a holding pattern since the 2016 Brexit referendum, but that was broken by the results of the UK’s General Election, which took place on December 12th, when the UK’s Conservative Party were returned to government with a strong majority in the House of Commons.
Current draft dated January 16, 2020. Final comments on the draft to be submitted by Friday, February 14th
Blacklined against draft dated September 5, 2019
According to recent research by Fitch, borrowers should have a compelling appetite for “hardwired” LIBOR fallbacks. The downside risk of the amendment fallback – ending up in Prime – may be more likely than borrowers appreciate and the cash flow and ratings implications could be material. We discuss all below.