U.S. leveraged finance issuance totaled a file $1.08 trillion in 2021, together with $465 billion in excessive yield loans and $615 billion in U.S. institutional loans, in accordance a report back to be printed Friday by KKR Credit score, a unit of KKR & Co. Inc.
KKR,
Whereas many of the eight sub-sets of the credit score market turned in optimistic complete returns for 2021, solely two of the eight had been optimistic in January: European financial institution loans (up 0.35% in complete return) and U.S. financial institution loans (up 0.36%). Asia excessive yield credit score had the worst January outcomes with a unfavourable 4.81% return. Total, CCC-rated bonds have held up effectively within the face of volatility, KKR stated. “In January, whereas broader credit score markets began to weaken beneath strain, CCCs, the perceived riskiest a part of the market, weathered the storm greatest,” KKR stated. CCC-rated bonds outperformed equities in January, KKR stated. “We have now already began to see the market shift in an unambiguous style in the direction of credit score and we imagine the time for elevated credit score publicity is now,” the agency stated.