Marathon Asset Management’s Post

The Tide Has Turned: With Q2 earnings in the books, credit metrics are now on the upswing. EBITDA and Debt-to-EBITDA improving (see box chart below), and debt service charge will begin to improve too as the Fed begins a series of 25bp declines in its coming meetings. While lower all-in yield for BSLs & Direct Lending will decline marginally, defaults rates and loss rates will also decline. I expect the Credit Markets, both fixed and floating to offer healthy risk-adjusted returns. Source: Pitchbook