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PDF | Research |Week of Dec 12, 2022

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Quote of the Week

The easy lifting is done.

– Vincent Reinhart, chief economist, Dreyfus.

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Soft Landings, Hard Choices

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This week the Federal Reserve raised interest rates by 50 bps at its December meeting, following four consecutive increases of 75 bps. That brings 2022’s number of hikes to seven. The Fed funds rate target now stands at 4.25% – 4.50%. It had begun the year at zero.


Critics worried the Fed took too long to grasp the systemic nature of inflation when it announced its abandonment of “transitory” over “permanent” as a descriptor of higher prices last November. Delay, they feared, would make it more difficult to get ahead of inflation without a rapid uptick that would throw the economy into a recession.


Regardless of how early or late the response, as our Chart of the Week depicts, this has been the fastest ascent in decades...

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Chart of the Week

Righty Tighty

Since March, the Fed has increased its rate target by 4.25%, the fastest climb in decades.

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Source: WSJ, Federal Reserve

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Stat of the Week

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Loan Stats at a Glance 

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PDI Picks

The shifting ESG agenda

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Our A-Z of ESG report asks what constitutes an effective policy for private debt managers in today’s world.

When we surveyed fund leaders earlier in 2022, there was overwhelming agreement that a stronger environmental, social and governance vision and culture creates value for a business. The ESG agenda has, as one respondent put it...

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Leveraged Loan Insight & Analysis

BDC portfolio marks expected

to move moderately lower

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BDCs navigated the most recent 3Q22 earnings season successfully, benefiting from the higher interest rate environment as rising base rates on their floating rate loans boosted interest income. At the same time...

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Contact: CJ Doherty/ Refinitiv LPC

The Pulse of Private Equity

Will middle-market fund

performance remain more resilient?

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Private market funds are due for a downturn, but there may be nuances. Shielded thus far from public markets’ volatility by sheer dint of their at-minimum quarterly markings, private pools of capital are likely going to...

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Contact: Alex Lykken / PitchBook

Covenant Trends 

Percentage of Loans that Allow Uncapped Synergies & Cost Savings EBITDA Adjustments, Sponsored v Non-Sponsored (LTM)

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Contact: Steven Miller / Covenant Review

High-Yield Bond Statistics

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Weekly fund flows source: Lipper
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Private Debt Intelligence

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Information technology dominates

PD in North America

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As we near the end of 2022, the dominance of the information technology sector in private debt in North America is showing. 71 deals have been completed in the sector in 2022 YTD, which puts it behind several other sectors...

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Contact: Laura Messchendorp / Preqin

Debtwire Middle-Market

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Source: Cliffwater Direct Lending Index and BofA Merrill Lynch US High Yield Effective Yield

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Contact: Hema Oza / Debtwire 

Middle Market Deal Terms at a Glance

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Select Deals in the Market

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This publication is a service to our clients and friends. It is designed only to give general information on the market developments actually covered. It is not intended to be a comprehensive summary of recent developments or to suggest parameters for any prospective financing opportunity.