IB and leverage: financing after the cut
Investment-grade issuance spiked after the cut, high yield is selective and private credit remains pivotal for sponsor deals.
Financing conditions improved after the Fed cut: IG issuance spiked in early September and reverse Yankee euro deals hit records; HY is constructive but selective; banks still report tighter C&I standards, and private credit remains pivotal for sponsor deals as equity checks modestly fall from 2023 highs.
Next steps
- For LBOs, size debt to withstand 200–300 bps rate sensitivity and a 1.0x EBITDA wobble.
- Pre-place flex with both BSL and private credit to protect certainty.
- Treat euro prints opportunistically for IG issuers.
- Lock in call-light structures where possible.
Informational content only. Not investment advice.