Competition for mandates will increase, leading to further pricing compression, particularly fees, lengthening of tenors and loosening of structures.

Justin Crane

Categorized in : Company News

Liquidity, and thus competition, has remained at a consistently inflated level as policy banks in China, Japan, and Europe progressed with quantitative easing measures, simultaneously there has been a shortfall of borrowers looking to access the syndicated loan markets as lenders have shown an increased willingness to provide large bilateral loans at tight prices to avoid scale backs.

For top tier borrowers, the view is that pricing is close to or at the bottom, simply because it is at or below the funding costs of the majority of the lender base. In addition, the USD-JPY basis has widened so the Japanese mega banks may be less aggressive on pricing.