Einhorn bets against U.S. high yield, investment grade debt
“Rating agencies have been complacent and allowed debt/Ebitda and debt/equity ratios to deteriorate without a corresponding reduction in credit ratings,” Einhorn said in the July 25 letter.
Leveraged loans
Warren warns consumer, corporate debt could cause next crisis
The Democratic presidential candidate argued in a blog post that the U.S. could avoid a recession by canceling most student debt and authorizing regulators to more aggressively monitor leveraged lending.
Banks exposed to possible loan market tumult, BIS says
Banks may be exposed to a shakeout in the $1.3 trillion leveraged-loan market even though they mostly own the safest portions of debt, according to the Bank for International Settlements.
‘The risk isn’t in the banks’: Fed’s Powell on leveraged lending
Federal Reserve Chairman Jerome Powell says the agency is closely monitoring leveraged lending risks, but suggests further regulations on banks aren’t warranted.
BofA, longtime leader in leveraged loans, warns of `carnage’
The U.S. economy is on solid footing except for one potential trouble spot, according to Bank of America Corp.’s Chief Executive Officer Brian Moynihan: leveraged loans — a business the bank has dominated for a decade.
Is a leveraged lending crisis imminent? Depends who you ask
Lawmakers waded into a growing debate about the threat posed by corporate credit risk.
System can withstand threat posed by leveraged lending: Powell
Although higher corporate debt could hurt the economy, Federal Reserve Chair Jerome Powell argued changes made since the last crisis will guard against a meltdown.
Brown to regulators: Be ready to discuss leveraged loans at hearing
The ranking Democrat on the Senate Banking Committee says he wants answers from the Financial Stability Oversight Council on efforts to address corporate debt risks.
Banks healthy enough to absorb leveraged-loan risks: Moody’s
Amid widespread concern about their exposure to leveraged lending, the debt rating agency says banks have sufficient earnings and capital cushions to continue investing in the sector.
By
Andy Peters
Quality of shared credits improves but leveraged-lending risks remain
Despite a generally positive picture in the Shared National Credit report, regulators warned that underperforming loans in the portfolio remain elevated.
Corporate debt credit standards ‘deteriorating,’ Fed warns
The amount of debt owed by businesses and the valuations of corporations are elevated, creating a growing source of concern, the Federal Reserve said Wednesday.
JPMorgan says leveraged loans to remain top 2019 performer
Cracks may be visible in U.S. leveraged loans, but investor concerns about credit are "somewhat overblown," according to JPMorgan Chase.
Will Democrats try to rein in banks’ leveraged lending?
While they won’t be in position to enact legislation, House Democrats could use their newfound power to spotlight issues that Republicans have largely ignored, including the exploding levels of corporate debt.
By
Andy Peters
Next plan to speed settlement targets new-issue leveraged loans
The Loan Syndications & Trading Association wants to introduce “delayed compensation” for brokers who have to wait too long to take possession from agent banks.
By
Glen Fest
Fed warns over leveraged lending as banks chase riskier deals
The Federal Reserve is getting more concerned about risks from the leveraged loan market, with a key official saying it's now taking a "closer look" at whether banks are chasing deals without adequately protecting themselves against losses.
What’s lost in transition from Libor to new benchmark
The London interbank offered rate has its faults, but at least it compensates for counterparty risk; not so the benchmark being touted as a replacement.
By
Glen Fest
Oaktree on watch for signs of HY market cool-off
The Los Angeles-based distressed-debt specialist has $20.5 billion in dry powder, including over $8.8 billion in uncommitted capital stored in a dormant opportunities fund.
By
Glen Fest
Moody’s: Liquidity woes easing for junk-rated firms (for now)
Only 2.6% of speculative-grade rated firms with public financials carry Moody's weakest liquidity rating, a drastic reduction since March 2016, helped by a recovery in the oil and gas sector.
By
Glen Fest
Leveraged lending guidance in limbo after GAO move
A GAO determination has effectively nullified a 2013 leveraged lending guidance. But that leaves the future uncertain about what, if anything, regulators will devise to replace it — and how banks should treat such loans in the meantime.
GAO ruling puts leveraged lending guidance in GOP crosshairs
Federal regulators’ 2013 guidance on leveraged lending should have been treated as a rule under the Congressional Review Act – and is now eligible for Congress to repeal, the Government Accountability Office said Thursday.
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