Credit Markets Downturn (specific to LevFin)
O
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(King Kong, 1,016
Points)
on 6/12/10 at 9:42am
Hey guys, will be working for a LevFin team over the summer. heard through the grapevine that whereas they were absolutely slaughtering it up until very recently- deals left, rightm, and center, the credit markets have soured and things may be slow going forward.
I am not that well versed in the credit markets... can anyone bascially in layman's terms explain what is happening/may likely happen over the summer? Concern is if things dont pick up, team will not have the headcount to convert to FT analysts.






On the contrary, going
On the contrary, going forward leveraged finance should be the most robust business as our economy picks up.
KICKIN ASS AND TAKING NAMES
As long as you perform well,
As long as you perform well, you will be fine for FT.
Macro picture slowing things
Macro picture slowing things down for sure though still some action - plenty of companies have no choice but to go to the market for financing and many want to, but are holding out, often at bank's advice, hoping for picture to clear up a bit. As the picture at least settles down a bit, if it does, then the market will improve; the issue isn't really availability of capital as I see it as much as uncertainty which constrains action. Unfortunately both have same effect.
And yeah, market was hot until about 2 months ago, and especially hit a wall over last 3-4 weeks, but credit markets are often like that and has been the same since 07 - windows of large issuance followed by quiet periods.
On your internship - do your best to impress, even if the team isn't able to commit to hire you back they should still (depending on bank) be able to recommend you be hired even if they aren't sure they will have space for you next year.
And the loan market is still
And the loan market is still relatively robust. Banks are still looking to commit to deals. Unless there's a substantial meltdown in the next couple of months, Lev Fin will be hiring.
hopefully, this will
hopefully, this will translate into severely reduced hours and then the credit markets flood open exactly at the end of the summer. but one can only hope.
Dunno about deals, but the
Dunno about deals, but the credit markets are now slowly improving after the correction. The problem is that investors are skittish, split between improving fundamentals and generally nervous expectations of possible double dips. So they ovverreact to any news, be it good or bad.
refi refi refi 2011 2012
refi refi refi
2011 2012
Look into the maturity cliff
Look into the maturity cliff of LBO debt from the boom. Companies refinanced and launched new financing while the markets were good, and are now delaying and deferring while the markets are softer but sooner or later a lot of that debt is going to need to get refinanced.
There have been many great comebacks throughout history. Jesus was dead but then came back as an all-powerful God-Zombie.