Jan 01, 2013
From the Global Enterprise Institute
KPMG's Capital Advisory Q4 2012 Credit Markets Quarterly Update provides a snapshot of the Q4 2012 activity, including a general overview, trends, pricing, and structures.
Key insights from the Q4 2012 newsletter include the following:
- The overall loan market expanded in Q4 2012 with issuers taking advantage of the strong liquidity in the market and the supply/demand imbalance to push for more generous structures, terms, and reduced pricing. New-issue loan volume during the quarter grew to $136.0 billion, reaching $465.2 billion for the year surpassing 2011’s volume of $375.1 billion by 24 percent.
- Dividend recaps continued its rapid pace in Q4 2012 driven by the proposed changes in dividend tax rates. Total volume reached $15.6 billion during the quarter pushing year-end volume to $56.4 billion, nearly 55 percent greater than the $36.4 billion booked in 2011.
- Early expectations for 2013 remain positive driven by projected moderate LBO activity, continued recap activity (albeit at a much slower pace than during 2012), and expected favorable technical conditions aided by the eleventh-hour deal in Washington that provided certainty around tax rates and averted the fiscal cliff – at least for now.