Debt assumption changes in past 48 hours

Treasury / SOFR rates are down (with increased likelihood of cuts) but presumably spreads would be up (by a larger margin).  Net-net this results in more expensive financing.  Is my lay person's assessment accurate?  

3 Comments
 

Yesterday, treasury rates were anywhere from 30-35 bps lower than last Friday. Agency spreads were 10-12 bps wider and life companies were 15+ wider during that same period. Net net, more competitive (cheaper) financing.

We signed up a LifeCo deal at 150 bps over the 10 year yesterday, which was the same spread we were quoted before the massive fall in rates.

 

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