by LCD News
The U.S. leveraged loan market, which over the long-running, just-ended credit cycle managed to skirt wide-scale defaults thanks to borrower-friendly deal structures and strong corporate earnings, is proving no match for today’s coronavirus environment.
There were 11 defaults from loan issuers in April, the most ever during a month, exceeding the previous record of 10 in October 2009, in the wake of the last major financial crisis, according to the S&P/LSTA Index.
While perhaps not unexpected, the relative flood of defaults was dramatic. April’s tally was more than during the entirety of 2020’s first quarter, and with grim forward economic indicators thanks to the COVID-19 pandemic, market sources expect more defaults ahead.