LSTA

The SEC’s Division of Examinations recently published its exam priorities for 2025. The LSTA’s Elliot Ganz summarizes what they may mean for private funds and mutual funds here: https://lnkd.in/e6fuzY96 #SEC #funds #markets

Corporate credit could be impacted by the outcome of three Congressional elections next month. The LSTA’s Elliot Ganz discusses these races here: https://lnkd.in/eQxDDdPC #credit #loans #markets

The LSTA's Elizabeth Yazgi continues the LSTA’s quarterly covenant trends series with a summary of the themes that have shaped loan markets and credit document terms over the course of Q3. Many of the salient macro trends from Q2—the U.S. election season, uncertainty in the economy, and competition between BSL and private corporate credit players—continued to haunt the markets during the summer, choking off M&A flow. The corporate loan market remained active, however, due to robust refinancing and repricing activity. A recent resurgence in M&A (thanks in part to the Fed’s fall rate cut) and lender demand for deal flow have made for borrower-friendly covenant packages. Q3 has thus played host to an erosion of lender protections, looser covenants, and the recurrence of LMT structures; we expect borrowers to maintain the upper hand as the year closes out. Read full coverage on the 3Q24 installment here: https://lnkd.in/diChp4kr #loans #credit #lending

SEC Chair Gary Gensler dedicated his prepared remarks at today’s Bloomberg Global Regulatory Forum to the value of nonbanks. Gensler noted that not all risks in finance are the same and that they should not be painted “with a broad brush.” Similarly, he said that not all nonbanks have risks that heighten financial fragility and that when evaluating resiliency, it’s important not to dismiss the contribution that nonbanks make to efficiency, liquidity, and transparency. Read his speech here: https://lnkd.in/d_W4e-vX #SEC #reporting #markets

According to the LSTA’s Theodore Basta, 3Q secondary loan trading volume increased 22% year-over-year, to $200 billion, as year-to-date activity now stands 11% higher. Even more impressive, the $200 billion figure represented the busiest third quarter on record. Read more here: https://lnkd.in/egmijZXn #loans #trading #markets

In a further step towards industry harmonization around ESG reporting, the LSTA and the Loan Market Association (LMA) have launched an amended version of the ESG Due Diligence Questionnaire (DDQ) for Managers. The revised DDQ aligns more closely to existing market standard diligence tools, namely the UN PRI DDQ for Private Debt Investors and the Alternative Credit Council’s questionnaire. The update also broadens the scope of the DDQ to address considerations for managers active in the broadly syndicated loan market. The LSTA's Elizabeth Yazgi describes the refreshed content of the DDQ and how it promotes industry convergence regarding ESG here: https://lnkd.in/eR-sjmY7 #ESG #credit #loans

The LSTA and a coalition of ten trade associations have requested more time to prepare comments on the proposed FDTA standards. Many market participants were surprised when the agencies chose to require a single financial instrument identifier in their proposed standards. Even more so that the chosen identifier is not used broadly today. What does this mean, is it feasible, and will it have unintended consequences are all real questions that require sufficient time to drill into. The LSTA's Tess Virmani explains that many market participants will not be able to provide the agencies with important industry feedback by next week’s deadline. Read more here: https://lnkd.in/eQguVKHb #loans #credit #markets

SEC Commissioner Peirce yesterday dispelled many of the misconceptions about private credit in a presentation at the SIFMA/Mayer Brown Private Credit Forum. Notably, she asserted that the non-prudential framework that private credit is regulated under is a strength, enabling lender flexibility and responsiveness, and systemic resilience. Click here to read her remarks: https://lnkd.in/eyNFPYph #SEC #credit #lending

At an event in Buenos Aires yesterday, Minneapolis Federal Reserve Bank President Neel Kashkari affirmed the view that private credit funds reduce systemic risk given their modest leverage and use of long-term capital. Click here to watch a clip: https://lnkd.in/dnBY_r4m #credit #loans #markets

Financial definitions in credit agreements can be tricky and hard to decipher. In this webinar, Financial Definitions 101, hosted by National Association of Women Lawyers and co-sponsored by the LSTA, our expert panelists shared their perspectives on how borrowers/sponsors and lenders view them when negotiating deals. Read more here: https://lnkd.in/dBzDfqKr #credit #lending #markets