15 Oct Voya Senior Loan Group – ‘Talking Points’ Weekly Update (incl. September in Review)
Voya Senior Loan ‘Talking Points’ is a weekly publication from the Voya Senior Loan Team Heads, which provides key insights and results in the Senior Loan marketplace.
Taking a Breather
On the week, the S&P/LSTA Leveraged Loan Index returned 0.18%. The average Index bid jumped 161 bps, to 96.91; however, the bulk of the increase was due to an Index rebalancing that removed three Texas Competitive Electric Holdings loan facilities following the parent company’s exit from bankruptcy. The YTD total return for the Index climbed through 8.00% this week, to 8.09%.
After the busiest September on record for new issuance, October’s MTD volume of $18 billion represents a noted deceleration of the post-Labor Day push. Nonetheless, new issue business is essentially on par with the 2016 monthly average of $26 billion. Trading activity in the secondary market was relatively light, and nearly all transactions allocating debuted at or above their issue price.
September in Review
Loans enjoyed their seventh straight month of positive returns in September, as the asset class gained 0.87%, bringing the YTD return to 7.72%, a significant improvement over 2015’s 1.44% return for the same period. Returns topped August data across the ratings spectrum, though lower-rated, second lien, and distressed credits once again performed best in the risk-on atmosphere that dominated the month.