The Credit Edge by Bloomberg Intelligence

Private lending is the best opportunity in debt markets today, says Tristram Leach, co-head of European credit at Apollo Global Management. “If I had to pick a single area that I think you’re meant to lean in to — and frankly, where we’re seeing clients lean in to as well — it is private credit,” he tells Bloomberg News senior reporter Lisa Lee and senior editor James Crombie. An extra 200 bps over publicly syndicated loans is enough compensation for the relative lack of liquidity, he adds. Also in this episode of the Credit Edge, Bloomberg Intelligence analyst Matthew Geudtner weighs the benefits to company pension plans from higher rates. And he flags Raytheon, a unit of RTX, as one to watch after it announced a $10 billion debt-funded share buyback program.See omnystudio.com/listener for privacy information.

Opportunities for robust returns in debt markets, Blackstone's optimistic outlook on default risk, Bloomberg Intelligence analyst's positive outlook for private credit and BDCs, discussion on the growth and opportunities in middle market lending and private credit, exploration of the private nature of borrowing money and business development companies, and concerns about the economy and market volatility.

The resignation of a top Texas bankruptcy judge after it emerged he was dating a leading lawyer has rocked the insolvency world. To analyze the fallout, we’re joined by Steven Church and Amelia Pollard from Bloomberg News. Creditors may now challenge some of the judge’s prior rulings, while his downfall revives scrutiny of where companies are filing for bankruptcy. Also in this episode of the Credit Edge, Bloomberg News senior editor James Crombie asks Bloomberg Intelligence analyst Spencer Cutter about a consolidation wave in the energy sector. Exxon Mobil’s acquisition of Pioneer Natural Resources may spur oil and gas sector consolidation that would boost bonds, Cutter says.See omnystudio.com/listener for privacy information.

Fortune favors the bold in credit markets this year, with the biggest returns coming from the highest-risk debt. To analyze why and what’s next, we’re joined by Gowri Gurumurthy, a veteran high-yield bond reporter at Bloomberg News. Triple C rated bonds and leveraged loans are poised to extend gains barring a major geopolitical shock, while defaults will probably stay low, Gurumurthy says. Also in this episode of the Credit Edge, Bloomberg News senior editor James Crombie asks Bloomberg Intelligence analyst Robert Schiffman about the outlook for the technology sector amid an explosion in artificial intelligence. Nvidia is the poster child for AI, with huge potential to increase free cash flow, Schiffman says.See omnystudio.com/listener for privacy information.

The $8 trillion mortgage-bond market plunged to levels rarely seen since the global financial crisis as Treasury yields surged. To analyze why and what’s next, we’re joined by Christopher Maloney, mortgage strategist at BOK Financial Capital Markets, and Bloomberg News reporter Scott Carpenter. Homebuyers face the threat of even larger debt payments, while credit investors may find an opportunity to buy cheap bonds. Also in this episode of the Credit Edge, Bloomberg News senior editor James Crombie asks Bloomberg Intelligence senior credit analyst Arnold Kakuda about the outlook for financial institutions following this year’s banking crisis. Wall Street faces more regulatory pressure just as private lenders get more aggressive, Kakuda says.  Listen to this episode here on the Bloomberg Terminal and on Apple Podcasts and Spotify.See omnystudio.com/listener for privacy information.

China’s property crisis has lurched into a perilous new phase — with significant implications for the world’s second-largest economy, according to Bloomberg News’ Alice Huang. The deepening distress hurts other industries and repels foreign investors, Huang says. In this episode of the Credit Edge, Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Spencer Cutter about growing risks to energy debt from depressed natural gas prices. Smaller producers are most vulnerable as some see cash flow turn negative, Cutter says.Listen to this episode on Apple Podcasts and Spotify.See omnystudio.com/listener for privacy information.

Leveraged finance has sprung back to life with jumbo buyout deals and dividend loans, according to Bloomberg News’ Claire Ruckin. Credit investors are increasingly hungry for risk and companies are piling on debt amid hopes of a soft landing and lower rates ahead, Ruckin says. In this episode of the Credit Edge, Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Tolu Alamutu about growing distress in real estate. Trouble has spread through Sweden and other parts of Europe, while also putting pressure on financial institutions, Alamutu says. See omnystudio.com/listener for privacy information.

Companies hitting the bond market at record pace left investors hungry for more, according to Bloomberg News’ Caleb Mutua. The deluge will be short-lived as borrowers retreat, waiting for interest rates to come back down, Mutua says. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Mary Ellen Olson about what’s next for Vedanta Resources Ltd., the junk-rated Indian mining company with a pile of debt coming due. Extending bond maturities would buy the company time to sell assets and generate much-needed cash, Olson says. See omnystudio.com/listener for privacy information.

Hedge funds are jumping into the collateralized loan obligation market in pursuit of fat and steady returns, according to Bloomberg News’ Lisa Lee. CLOs are meanwhile menaced by the lingering threat of recession and higher rates — while increasingly repackaging private debt — Lee says. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Jeroen Julius about the outlook for the AT1 market after the collapse of Credit Suisse. Prices have recovered but for some investors, the market’s just too choppy, Julius says.See omnystudio.com/listener for privacy information.

Banks are readying about $15 billion of leverage buyout debt for sale starting in September, stepping back into M&A after losses piled up on their books last year, Bloomberg News’ Paula Seligson, says. Also on this episode of the Credit Edge podcast, Bloomberg News corporate finance reporter Olivia Raimonde chats with Bloomberg Intelligence analyst Jody Lurie, who covers the leisure sector. Lurie walks us through the cruise-line industry’s recovery from the pandemic.See omnystudio.com/listener for privacy information.