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.
On April 3, 2018, the New York Federal Reserve Bank (FRBNY) began publishing SOFR, the Secured Overnight Financing Rate, which is a potential replacement for LIBOR. Unfortunately, shortly thereafter, the FRBNY determined that the volumes of SOFR trades – around $850 billion daily – appeared too high.
In response to the “Request for Information Relating to the Production of Rates”, the LSTA submitted a letter to the Federal Reserve discussing the impact of a transition from LIBOR to SOFR (or another reference rate) on the U.S. syndicated loan market. The letter discusses key stakeholders in the syndicated loan market and why they […]
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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.