The most recent Phoenix Management “Lending Climate in America” Survey showed more lenders anticipating spreads to decrease. The percentage of lenders expecting to reduce their current interest rate spreads increased nine percentage points, representing 30% of total responses in Q2/13.
Phoenix Management said results from its Q1 “Lending Climate in America” Survey show that lenders have shifted lending expectations from negative to positive.
The Wall Street Journal noted that impatient lenders and the stubbornly weak economy are undermining the goal of the bankruptcy process by pressing for a fast trip to the auction block.
Fifth Street Finance announced that two new lenders joined its syndicated bank credit facility led by ING Capital, increasing the facility size by $35 million to $415 million from $380 million.
So far this year, asset-based lending (ABL) has been one for the record books — although the accompanying enthusiasm has been fairly muted. Looking forward to Q4/11 and into 2012, prospects for deal flow are in a bit of a fogbank in terms of where new deals will come from. And while it’s been a good year for ABL in terms of issuance, the rest of the year is unclear.
Lenders concede that in 2010, not only was liquidity resoundingly back, making everyone itchy to put money to work, but more noteworthy, lenders could look back over the last two years and confirm that their portfolios had made it through the credit crisis relatively unscathed. In turn, deal structures became more aggressive as lenders sought to grow their books.
Asset-based lending got off to a tepid start in 2009 and gained momentum part way through the year, only to see issuance taper off by year-end. At $8.55 billion, Q4/09 issuance, while up 45% over Q4/09, was off 15% from Q3/09 levels, to close out the year with the lowest quarterly issuance since the end of 2008. The softness was disappointing and arguably a bit of a surprise.