May 7, 2019 - On May 6, 2019, the Federal Reserve issued its second Financial Stability Report, which included a section on “Vulnerabilities Associated with Elevated Business Debt”. The section discusses higher leverage, lower ratings and looser documentation in corporate credit and their potential impact on defaults when an economic slowdown materializes. However, the report also noted that, systemically, the holders of debt generally seem well positioned to deal with their exposures. In fact, the LSTA has done similar research, which is available in this attachment as well as in a number of presentations that we have published. The LSTA supports regulators doing their jobs and reviewing market risks. Their analyses reveal, as does ours, that while credit risk may be increasing, systemic risk in the loan space is well below where it stood in 2007. The LSTA stands ready to work with regulators as they do their due diligence on this vibrant and important market.

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2020 Secondary Trading Executive Summary

LSTA secondary loan trading volume increased 4% to a record $772B in 2020. The COVID-19 induced price volatility of March went on to set the…

We Await LIBOR Announcements But Can Still Act Today

Once ICE Benchmark Administration’s (“IBA”) consultation on its intentions to cease the publication of LIBOR closes on Monday, their feedback statement could follow shortly thereafter.

Election News: New LSTA Board Inaugurated

n January 19, 2021, the LSTA held its Annual Member Meeting, electing its 2021 Board of Directors. The Board of Directors are a dedicated lot,…