‘Negative’ forward calendar presents challenges for CLO issuers
Spreads and investor demand make conditions ripe for a surge in CLO deals before the election, but a strain on loan supply may complicate the picture.
By
John Hintze
Commercial lending
CLOs fight back against hedge fund efforts to siphon value
Brigade Capital Management, Blackstone Group Inc., CIFC Asset Management and Bardin Hill Investment Partners are among the firms looking to change the terms of the CLOs they oversee to put them on better footing when companies they’ve lent to can’t meet their obligations. Collateral managers are often handcuffed in distressed situations due to strict checks on the risks they can take.
CRE concerns intensify as stimulus programs expire
Commercial real estate loans are vulnerable as financial assistance for tenants winds down and might not be fully renewed. Late rent payments could rise, leading lenders to press landlords to pay up.
Dan Fuss shuns CLOs in his funds as Fed can’t save everything
“The Fed has made it clear that they don’t want a liquidity problem in the Treasury market or the higher-grade corporate market,” Fuss said. “They cannot, unfortunately, underwrite lending in the private markets.”
Lawmakers urge Fed, Treasury to let CRE borrowers tap Main Street loans
Commercial real estate companies are among those left out of the Federal Reserve’s middle-market relief program, but House members said they need government-backed financing to navigate the pandemic as much as anyone.
![Fed Chairman Jerome Powell said the central bank had previously concluded that asset-based borrowers were able to secure financing elsewhere. Treasury Secretary Steven Mnuchin said “small hotels do not fit into [the Main Street Lending Program] because they already have other indebtedness.”](https://vip.arizent.com/ab/wp-content/uploads/sites/4/2020/09/powell-jerome-mnuchin-steven-bl-092220.png?w=432)
Private equity using loans for payouts at fastest pace in years
Private equity firms are hitting the U.S. leveraged loan market at the fastest pace in years to fund shareholder payouts with about $8.6 billion of dividend recapitalization deals launched this month.
Weekly Wrap: Fewer college football crowds mean more hotel woes
Deals, trends and research in structured finance and asset-backed securities for the week of Sept. 11-17
By
Glen Fest
‘Flat to slightly down’: 3Q loan demand disappoints
Banks reported decent loan growth in the spring and early summer as businesses rushed to draw down credit lines and tap the Paycheck Protection Program. But demand has been muted since, and bankers can only guess when it will pick back up.
Delta to borrow $9 billion in largest airline debt deal ever
The prospective payout is so alluring to investors that they’ve placed three times as many orders as bonds and loans available for sale. That allowed Delta to boost the size of the deal from an original $6.5 billion, enough for the company to rule out the need for any federal aid.
Mercedes-Benz Financial Services prices $1.01B prime auto-lease ABS
The captive-finance lender for U.S. Mercedes-Benz deals closed on its second transaction of the year, and the first auto-lease ABS to price since July.
By
Glen Fest
Trepp: Near-term CRE maturities may be driving ‘strategic’ defaults
A new report on bank-held commercial real estate and C&I loans indicates troubled borrowers may be skipping payments on loans they won't be able to refinance or extend over the next year, leading to a potential wave of defaults over the next four to six quarters.
By
Glen Fest
Trio of consumer lenders launch first 2020 ABS deals
Liberty Lending, Upstart Network and Regional Management Corp. are looking to price bonds backed by pools of unsecured consumer loans, amid market worries about the sectors' potential challenges during the COVID-19 outbreak.
By
Glen Fest
Weekly Wrap: TALF funds largely absent from ABS dealmaking
Deals, trends and research in structured finance and asset-backed securities for the week of Sept. 4-10
By
Glen Fest
CMBS delinquency rate down in August, but ominous conditions remain
Some of the cures were the result of short-term remedies and could reverse as relief measures end.
Lenders flowing back into CRE CLO market
A three-month drought in CRE CLO issuance came to an end this week with new deals from Exantas and A10 Capital.
By
Glen Fest
Fitch: Expiring deferrals may lead to near-term spike in MPL defaults
The ratings agency reports that the MPL industry might reckon with a potential spike in defaults as borrowers are rolled out of two- and three-month COVID-19 hardship programs.
By
Glen Fest
As Fed helps businesses, Democrats ask: What about consumers?
The Senate Banking Committee met Wednesday to review central bank lending facilities such as the Main Street Lending Program, which provides bank-issued loans to middle-market firms. But some lawmakers on the panel said the focus of pandemic relief has been misplaced.
Lenders press Congress to restart — and revamp — PPP
Bankers and fintech executives want lawmakers returning to Washington to focus on streamlined forgiveness and a second round of Paycheck Protection Program loans for small businesses.
Online loans are holding up better than expected
Fintech lenders that reported a surge in missed payments at the start of the pandemic have seen credit quality rebound substantially since. But credit performance could still deteriorate if high unemployment persists and Congress fails to enact more relief measures.
PPP loans worth billions at risk for fraud, oversight panel says
More than $1 billion in coronavirus relief went to small businesses that received multiple loans and a congressional subcommittee analyzing the Paycheck Protection Program says it has seen evidence of fraud in thousands more loans.
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