Banks pull out checkbooks for LBOs as rates fall

 

Investment banks, forced to take big writedowns on risky merger and acquisitions loans after a global surge in interest rates, are now jumping back into leveraged buyouts — one of the most lucrative areas in finance.

Traditional lenders and private credit managers are telling private equity firms, known as sponsors, that they can provide more than $15 billion of debt on a single junk-rated deal. That’s about 50% more than last year, according to some market participants, when a number of loans were stuck on lenders’ balance sheets after central banks aggressively hiked rates to tame inflation.

https://www.bloomberg.com/news/articles/2024-10-05/banks-whip-out-checkbooks-for-lbos-as-rates-fall-credit-weekly