Capital Markets Insights: Credit Availability for the Middle Market Remains Robust

December 14, 2015

Recent trimming in first lien debt appetite resulted in a higher proportion of second lien and junior debt in capital structures. The fuller covenant packages typical of the private market, combined with unabated growth in private investor capital formation, have served to differentiate middle market conditions from those of the broader liquid markets. While the weighted average cost of debt for middle market issuers has increased modestly, credit availability-both in terms of leverage multiples and cost-is robust.

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