Nov 01, 2013
From the Global Enterprise Institute
KPMG Capital Advisory Q3 Credit Markets Update provides a snapshot of the Q3 2012 activity, including a general overview, trends, pricing and structures.
Key insights from the Q3 newsletter include:
- In comparison to a contracting market in Q2 2012, the overall loan market expanded in Q3 2012 with issuers benefiting from lower interest rates and more aggressive credit structures. New-issue loan volume grew to $114.0 billion, which represents the largest third-quarter total on record, up from $87.9 billion in Q2 2012 and $53.4 billion in Q3 2011.
- The supply/demand imbalance is attributed to increased volume and lower spreads across many types of debt including loans focused on middle market, high yield and asset-based lending.
- Participants expect to see continued robust loan activity in Q4 2012 – both opportunistic (i.e., repricings, dividends and amend-to-extends) and M&A, as arrangers are busy looking at M&A situations and talking to corporations that are looking to take advantage of low interest rates and still sitting on a record amount of cash.