September 17, 2019 - In response to many policymakers mistakenly comparing leveraged loans to the subprime crisis of the financial crisis, Lee Shaiman, LSTA Executive Director and David Lerner, Senior Portfolio Manager and Head of Senior Secured Loans and Structured Credit at Shenkman Capital Management, an LSTA member, co-authored an article featured in Morning Consult. The outlet is well known for its national polls and reaches over 60,000 unique readers a month, many of whom are DC’s political elite. The article defends the benefits of the corporate loan market and leveraged loans against political scrutiny:
“The reality is that aside from a few surface-level similarities, the leveraged loan market of today and the subprime mortgage market of yesteryear are fundamentally different. Policymakers need to come to terms with this before aggressive rhetoric stifles the flow of capital to countless companies across the country…
Any objective analysis of today’s corporate loan market should lead members of Congress and the administration to conclude that leveraged lending is unlikely to spur a ‘subprime 2.0’ situation.”
The full version of the article can be found here. LSTA is committed to being an educational resource for policymakers and the media alike.