The latest credit outlook survey of the International Association of Credit Portfolio Managers (“IACPM”), a global membership of more than 100 banks, insurance companies and asset managers, indicates that recession fears have eased. The IACPM’s index was at a neutral -3.3 in Q1-2019 compared to...
The biggest surprise in 2018 that caught nearly every energy investor and trader off-guard was the steep 30% decline in oil prices at the beginning of the fourth quarter. Not surprisingly, this large pullback has resulted in a surge of bearish calls for a collapse...
September 2018 marked the tenth anniversary of the collapse of Lehman Brothers, when the last credit cycle came to an abrupt and violent end. The rebound in credit markets has been spectacular and gave birth to a new asset class, private debt, that continues to...
The smart money, according to S&P Global, is gearing up for a downturn. The longest credit cycle since 1985 is in extra time and there are many signals, outside of the internal credit market fundamentals that we have revealed in previous letters, which justify high...
“We are having a party at Apollo these days”, Jim Zelter, co-President. Apollo Global Management at 2018 Milken Institute Global Conference. Similar to the end of the 1990s expansion, investors today are juxtaposing a strong global economy with a nearly 10-year-old bull market in risk assets...
Here's what we saw. Coffrages Synergy (Coffrages) is a recognized and highly sought-after construction leader in Quebec for concrete foundations and versatile structural forms. It is led by an ambitious, result-oriented team motivated to grow beyond private-sector Quebec contracts. Others didn’t see it. We did. Transaction Overview Third...
IFRS9 was conceived in the wake of the financial crisis to address criticism of the prevailing impairment model that allowed banks and other lenders to delay recognition of losses. The goal of the new accounting standard is for lenders to have more appropriate levels of...
On November 1, 2017, an accounting asteroid hit the balance sheets of Canadian banks. Although markets have known about this momentous event for years, the reaction has been muted because most participants are underestimating its impact. The metaphorical asteroid, called IFRS9, is a new accounting...
The macroeconomic backdrop of steady, synchronized global growth, low inflation, and ongoing corporate profitability has kept investor optimism high and blue skies for riskier assets like credit. We are in the eighth year of the post-GFC economic recovery, one of the longest expansions on record,...
Ten percent of loans issued in the first half of 2017 to finance M&A transactions had EBITDA multiples of seven times, according to S&P LCD. However, this is understated by the aggressive practice by so many lenders to add-back savings and synergies based on future...