June 2013, US Leveraged Loan Market Analysis


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Through the first three weeks of May, the loan-market’s virtually uninterrupted 2013 rally persisted. During the final week of the month, however, loan prices eased about a quarter point. On the whole, the loan market remains resilient. Looking ahead, participants expect tone in the HY market to remain a key driver of loan market conditions.

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June 2013, US Leveraged Loan Market Analysis

  1. 1. US Leveraged Finance Market UpdateJune, 2013Steve Miller - Managing DirectorText
  2. 2. 89929497993/11 5/11 7/11 9/11 11/11 1/12 3/12 5/12 7/12 9/12 11/12 1/13 3/13 5/13S&P/LSTA Index – Average PriceSource: LCD - Leveraged Commentary & Data
  3. 3. Visible InflowsTextSource: LCD - Leveraged Commentary & Data, EPFR-$1B$2B$6B$9B$12B4/12 5/12 6/12 7/12 8/12 9/12 10/12 11/12 12/12 1/13 2/13 3/13 4/13 5/13CLO IssuanceLoan Mutual Flows
  4. 4. S&P/LSTA Index Loans OutstandingSource: LCD - Leveraged Commentary & Data$500B$515B$530B$545B$560B$575B4/12 5/12 6/12 7/12 8/12 9/12 10/12 11/12 12/12 1/13 2/13 3/13 4/13 5/13
  5. 5. Average New-Issue Clearing Yield of First Lien LoansSource: LCD - Leveraged Commentary & Data3%4%5%7%8%9%3/11 5/11 7/11 9/11 11/11 1/12 3/12 5/12 7/12 9/12 11/12 1/13 3/13 5/13All-BBAll-B
  6. 6. Dividends Financed by Leveraged LoansSource: LCD - Leveraged Commentary & Data$0B$1B$3B$4B$6B$7B6/12 7/12 8/12 9/12 10/12 11/12 12/12 1/13 2/13 3/13 4/13 5/13
  7. 7. 0%2%5%7%10%12%12/98 8/00 4/02 12/03 8/05 4/07 12/08 8/10Loan Default RateSource: LCD - Leveraged Commentary & Data5/13
  8. 8. • But pressure from HY weakness may persistLoan Market – Outlook• Internal loan market dynamics remain strong• Loan market still issuer friendly, but less soSource: LCD - Leveraged Commentary & Data
  9. 9. www.linkedin.com/groups/LCD-Leveraged-Loan-Group-2092432LCD Leveraged Loan Group ... 10,000+ contactswww.twitter.com/lcdnewsHeadlines, market chatterwww.facebook.com/lcdcomps/Daily Playbook, headlines, video analysisFollow LCDwww.lcdcomps.comnews, analysis, research, archiveswww.highyieldbond.comFree website covering the HY marketwww.leveragedloan.comFree website covering the leveraged loan market
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