Wall Street Banks Sweeten Leveraged Loan Terms Amid Volatility.
Wall Street banks including JPMorgan Chase & Co. and Morgan Stanley have made investor-friendly changes to some leveraged loan offerings, as uncertainty around President Donald Trump’s economic and regulatory policies roils global markets.
Borrowers have had to offer bigger discounts on certain new loans to attract buyers, as prices in the secondary market dipped to 96.45 cents on the dollar, according to the Morningstar LSTA US Leveraged Loan Index, around the lowest levels since August. Investors have also yanked cash from funds that buy the risky debt, helping to accelerate price declines this month.
JPMorgan on Friday changed some covenants on a loan offering for Natgasoline and hiked the interest rate by 75 basis points to between 5.25 and 5.5 percentage points over the benchmark, according to a person with knowledge of the matter. The pricing on the new loan was lowered to 97 cents on the dollar from 99 cents previously.
Commitments on the $525 million loan are now due Monday, according to the person, who asked not to be identified because the deal is private.
Source: Finance.Yahoo
