Private Debt Markets 2018

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  • Private debt: bumps are coming but the road will stay open

    The thriving modern private debt market has germinated and grown in a greenhouse — the post-crisis shrivelling of banks and central bank stimulus of debt markets. But already, the banks are coming back. Next, central bank support will disappear — and sooner or later there will be a recession. Will private debt markets cope? Jon Hay reports.

  • Schuldschein tries to keep old virtues but embrace the future

    The Schuldschein market has broken into unknown territory, welcoming borrowers and lenders from far-flung lands, while establishing itself as a hotbed for technological advancement. Can the miracle last? Silas Brown reports.

  • Schuldschein: no country for old men

    The Schuldschein market attracts a diverse mix of investors, with different tastes and needs. Amid the push and pull of a burgeoning market, the burning question is whether each of these differing characters will remain content ­— or whether some may get pushed out, as the market develops and changes shape. Silas Brown reports.

  • Can the Schuldschein stay on top when rate climate changes?

    The Schuldschein market attracted a record number of international issuers last year, and swept aside other forms of European private debt in the process. Now it must confront a bigger beast — a credit-hungry unrated public bond market — while simultaneously absorbing the impact of the European Central Bank winding down its bond purchasing programme. Silas Brown reports.

  • A new German export: the Schuldschein’s American dream

    The Schuldschein market has a grand ambition — to make it big in the US. Its reputation is growing internationally but it will not be easy to take on the more established private debt instrument, the US private placement note. Silas Brown asks: just how realistic is the Schuldschein’s American ambition?

  • Roundtable Discussion: Keeping the Schuldschein’s feet on the ground

    Private debt markets have made inroads into European funding strategies over the past few years, taking transactions from syndicated loan markets, as well as public bonds. The Schuldschein market has been particularly vibrant, racking up €27bn of issuance in 2017 from more than 150 transactions.

  • US private placements stake out their future

    As more cash is directed into the US private placement market, its attractiveness as a venue for more and larger deals will continue to increase. But even as it sets new issuance records, the question facing investors remains the same as ever — where can more deals be found? Richard Metcalf reports.

  • US PP foreign policy working despite Schuldschein’s land grab

    The US private placement market is the largest, most established private debt market in the world. It has huge international appeal, attracting issuers from around the globe who enjoy the ever evolving features the market offers and the fact that it seems to ride out any periods of weakness of other global markets. Nigel Owen reports.

  • Roundtable Discussion: Room for all in European private debt

    European issuers are finding ever greater depths of liquidity in the private debt market with the Euro PP, Schuldschein and US PP markets all offering different options. GlobalCapital brought together a number of bankers, investors and issuers in London in mid-March to discuss the state of the markets and how they see them developing.

  • Euro PP awaits end of QE but pan-European hopes fade

    The Euro private placement market has had to fight competition on all sides, and quantitative easing has helped to make that more intense, with banks, the Schuldschein market and public bonds offering very cheap funding. Prospects of the cheap money tide ebbing are raising spirits. But as Silas Brown reports, the idea of one Euro PP market covering Europe is fading.

  • Roundtable Discussion: Investors keep discipline, wait for narrow space to broaden

    Paris is a centre for continental European private debt activity that goes on outside the German Schuldschein and US private placement markets, which are both clearly defined by their legal documents.

  • Direct lending – a bite out of banks’ business

    New investors are pouring into direct lending and they are scrapping for bigger ticket sizes. Competition has grown quickly, allowing deals of increased complexity and variety to get done. But with everyone chasing the same deals, some have opted to compromise on credit quality. Can the industry weather a change in the credit cycle when it inevitably arrives? Nell Mackenzie reports.

  • Private debt’s attractions grow for infrastructure finance

    Infrastructure debt is a favoured corner of the capital markets for policymakers and investors alike. But nowhere is immune from plentiful liquidity in fixed income, and yields have been squeezed. Investors are getting paid less and less for the illiquidity and complexity of the asset class — so they have had to go looking further afield. Owen Sanderson reports.

  • Looming volatility set to test unrated bonds’ popularity

    Europe, unlike the US, has a market for unrated public bonds. This has been one reason why Europe’s private placement market has not grown as large as that in the US. In good times issuers find it a valid alternative to getting a rating, however, as tougher conditions return, the pendulum may be swinging the other way. Nigel Owen reports.

  • Low rates to end, but fresh challenges await MTNs

    The market for corporate MTNs has come under pressure from monetary policy, regulation and a proliferation of alternative products. Dealers have been forced to adapt to new conditions to find ways to demonstrate value, but fresh challenges are approaching. Lewis McLellan reports.

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