LFI Quick Stat: Dividend loan volume hits six-month high amid secondary rally, thin pipeline

With the secondary loan market running up amid a thin new-issue calendar, arrangers have rolled out a parade of dividend loans to capitalize on investor demand.

In the month-to-date, arrangers have launched $3.2 billion of term loans backing dividends, which is the highest monthly volume since October. What’s more, at 16.6%, dividend recapitalization loans as a percentage of overall dollar volume is the highest it’s been since LFI began tracking these data in September 2016. 

Of course, in the past the same hot market conditions that spawned dividend recap deals also generated repricings; however, spread-cutting exercises are practically nonexistent in today’s market.

— Kerry Kantin

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