The Credit Edge by Bloomberg Intelligence

Troubled companies are selling assets to relieve pressure from rising rates, slumping earnings and a looming maturity wall, says Irene Garcia Perez, who covers distressed debt for Bloomberg News. But potential buyers are offering less than sellers hoped and some corporations are offloading trophy holdings to generate cash. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Tolu Alamutu about the outlook for SBB, the Swedish company at the epicenter of a property meltdown. The crisis is getting worse by the day and has significant implications for credit markets beyond Sweden.See omnystudio.com/listener for privacy information.

Office landlords are falling behind on debt payments at the fastest rate in five years as tenants flee, says Scott Carpenter, who covers structured finance for Bloomberg News. Working from home slashed demand for office space, just as surging interest rates boost costs, spelling trouble for lenders. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also examines the impact of US culture wars on consumer companies with Bloomberg Intelligence analyst Louise Parker. Anheuser-Busch InBev’s recent collaboration with a transgender influencer slammed Bud Light sales, whacked its stock and may also dent the company’s bonds.See omnystudio.com/listener for privacy information.

More companies are going bust not long after securing cash that was supposed to save them, highlighting growing stress as rates rise and the economy slows, says Amelia Pollard, who covers distressed debt for Bloomberg News. More of these so-called liability management deals are expected to fail, making bankruptcies messier and more complex. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also quizzes Bloomberg Intelligence analyst Mike Campellone on the retail outlook, with consumers under pressure. Department stores like Macy’s and Target are poised to do better, while Under Armour is seen as a laggard.See omnystudio.com/listener for privacy information.

New accounting rules have exposed $64 billion in debt held by the largest US businesses, according to Lucca de Paoli, who covers distressed debt for Bloomberg News. This so-called supplier finance can be a safe way to manage cash flow — but it’s also been at the heart of some major corporate collapses, and could fuel ratings downgrades. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence analyst Sharon Chen about the outlook for SoftBank Group Corp. after it was cut deeper into junk. Elsewhere in Japan, Chen examines the refinancing risk at Rakuten Group Inc., which has $5 billion in bonds coming due.See omnystudio.com/listener for privacy information.

Private credit is having a coming-of-age moment, luring investors with double-digit returns and jumbo-sized deals, according to Silas Brown, who covers private credit for Bloomberg News. The $1.5 trillion market isn’t without risk, as borrowers grapple with surging costs and slowing earnings, while investors face liquidity and transparency challenges. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence credit analyst Rena Kwok about the outlook for Asian banks following heightened volatility in the sector. South Korean financial institutions are a weak link amid macroeconomic headwinds and exposure to mortgages.See omnystudio.com/listener for privacy information.

Companies are going bankrupt at the fastest pace since 2009 and there’s no end in sight as rates rise and the economy sputters, according to Jeremy Hill, who covers distressed debt for Bloomberg News. Lenders are no longer providing fresh liquidity to zombie firms across sectors -- from retail to commercial real estate -- leaving them to perish. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence credit analyst Jaimin Patel about the outlook for US utilities, a refuge from heightened economic and financial stress. Patel weighs the risks -- including access to capital markets and the impact of higher rates -- as well as the ESG opportunities for investors. See omnystudio.com/listener for privacy information.

Investors in troubled company debt are excited about the opportunities in banks, retail and health care as rates grind higher and the economy sputters, with one fund making $30 million on a single distressed debt trade. Consumers have been resilient but cracks are spreading, while a shift to electric vehicles adds stress in autos, according to Erin Hudson, who covers distressed debt for Bloomberg News. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence analyst Paul Vickars about European energy and utilities. High oil prices have created a windfall and the region is less exposed to volatility from Russia, Vickars says. The UK’s SSE is one to watch as companies sell more green, sustainability and transition bonds.See omnystudio.com/listener for privacy information.

Credit markets are cracking up as liquidity evaporates, according to Jill Shah, who covers leveraged finance for Bloomberg News in New York. Small businesses are struggling to borrow, distressed debt has surged, defaults are ticking up, banks have tightened lending standards and bankruptcies are on the rise, particularly in construction and retail. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie asks whether this is all bad for the US economy. Bloomberg Intelligence credit analyst Robert Schiffman, meanwhile, says he’s never been more bullish about the technology sector, despite all the fundamental headwinds. First-quarter earnings are showing signs of a turnaround, the biggest companies are generating a lot of excess cash and the outlook for investors is bright, Schiffman says.See omnystudio.com/listener for privacy information.

Distressed companies are moving assets out of lenders’ reach to raise new funds and buy time as higher interest rates and a slower economy bite. These controversial debt moves — known as drop-downs — are fueling a rash of creditor lawsuits, according to Reshmi Basu, who covers distressed debt for Bloomberg News. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence analyst Himanshu Bakshi about winners and losers in the financial sector. A steep decline in First Republic’s stock revives concerns about the health of banks, but most are in good shape and credit-card issuers are well-placed to ride out a US recession, Bakshi says.See omnystudio.com/listener for privacy information.

The restructuring of China Evergrande’s massive debt pile has been one of the riskiest bets in all of distressed investing. Redwood and Saba are among funds that recently endorsed a plan hammered out by the property-development giant and global creditors, according to Rachel Butt, a reporter at Bloomberg News in New York. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Bloomberg Intelligence analyst Matthew Geudtner about junk borrowers heading for investment grade despite macroeconomic headwinds. Companies in the travel and leisure sector are doing particularly well amid “revenge spending” by US consumers with pent-up demand after years of Covid-19 restrictions. Howmet Aerospace, an aircraft material supplier, is one to watch, Geudtner says. See omnystudio.com/listener for privacy information.

The takeover by creditors of German retailer Takko Fashion, with a solid operating performance, highlights the rising risk for junk-rated issuers facing a mountain of debt coming due. Some will require drastic solutions as funding costs jump and the economy slows, according to Giulia Morpurgo, a reporter at Bloomberg News in London. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also talks to Hong Kong-based Bloomberg Intelligence analyst Pri de Silva about opportunity in the financial sector following the recent collapse of banks in the US and Europe. Additional Tier 1 securities are poised for a comeback — with imminent issuance in Asia — and they’re too good for investors to miss given relatively high yields, says de Silva.See omnystudio.com/listener for privacy information.

Wall Street banks lost billions of dollars on leveraged buyout financing that they committed to before rates surged. A junk debt market reopening allows them to sell some of that down, but there are lingering concerns about the ability of very risky companies to access funds, according to Paula Seligson, a reporter at Bloomberg News in New York. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie also asks London-based Bloomberg Intelligence analyst Aidan Cheslin about opportunities and risks in the telecom, media and technology sector. Hybrid corporate bonds battered by the banking crisis may now offer value after the companies selling them emerged mostly unscathed.See omnystudio.com/listener for privacy information.

The banking crisis has made it harder and more expensive to borrow, tipping some of the riskiest companies into distress. In this episode of the Credit Edge Podcast, Eliza Ronalds-Hannon, who covers credit markets for Bloomberg News in Atlanta, looks at the biggest losers and winners — including Saba Capital Management’s Boaz Weinstein. Bloomberg News senior editor James Crombie also asks Bloomberg Intelligence analyst Spencer Cutter about opportunities in the energy sector. Oil companies that survived prior crises are in good shape to weather the next storm, offering a safe haven. Cutter also weighs the credit impact of Warren Buffett increasing his stake in Occidental Petroleum, a big part of many debt portfolios.See omnystudio.com/listener for privacy information.

The takeover of Credit Suisse by UBS included pulling the pin on $17 billion of risky CoCo bonds, also known as Additional Tier 1s (AT1s), and sending shockwaves through global debt markets. In this episode of the Credit Edge Podcast, Tasos Vossos, who covers credit markets for Bloomberg News in London, weighs the impact of the Swiss bank’s demise and the collapse of its AT1s. And Bloomberg News senior editor James Crombie asks Bloomberg Intelligence analyst Jody Lurie about funding risks for highly-indebted companies in the cruise, gaming and lodging sectors. As interest rates surge and earnings slump, junk-rated borrowers are exposed, but there are some hotel diamonds in the rough.See omnystudio.com/listener for privacy information.

Credit Suisse debt plunged into distress after the collapse of SVB Financial Group, spreading fear through the global banking sector. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie asks Bloomberg Intelligence credit analysts Arnold Kakuda and Jeroen Julius whether this is a Lehman Brothers moment for financial institutions. Bloomberg News reporter Amelia Pollard also digs into the impact of SVB’s failure.See omnystudio.com/listener for privacy information.

Adani has solved some liquidity problems but it’s not out of the woods. The crisis-ridden Indian conglomerate still needs to regain the trust of investors and has long-term issues with transparency. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie is joined by Divya Patil, who covers credit markets from Mumbai, and Bloomberg Intelligence analyst Cecilia Chan, who takes a look at retailers and casinos to gauge China’s reopening -- a key to the global economic outlook.See omnystudio.com/listener for privacy information.

Evergrande’s struggle to restructure billions of dollars in debt has significant implications for credit markets and the clock is ticking. The embattled Chinese property developer has about $290 billion in liabilities and faces a March 20 court hearing on a winding-up petition. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie is joined by Alice Huang, who covers China’s credit markets for Bloomberg News from Hong Kong, for an in-depth discussion. Meanwhile in India, Bloomberg Intelligence analyst Mary Ellen Olson assesses the risks for Vedanta Resources, which is running into liquidity problems.See omnystudio.com/listener for privacy information.

The largest buyout financing ever arranged by private credit firms may be in the works -- Apollo Global Management and HPS Investment Partners are among lenders that have offered to help provide a record $5.5 billion loan supporting the buyout of health-care technology company Cotiviti. In this episode of the Credit Edge Podcast, Bloomberg News reporter Jill Shah is joined by private credit reporter David Brooke to talk about the $1.4 trillion private credit market and the increasing role in M&A financing. Bloomberg Intelligence’s Stephen Flynn also provides an update on some of the names in the telecommunications and media sector, including the pending merger of Rogers Communications and Shaw Communications, the deteriorating outlook for Lumen Technologies and potential catalysts for Disney’s credit profile.See omnystudio.com/listener for privacy information.

The rally across risk assets was perhaps felt the most in a corner of the structured credit market, agency backed mortgages. In this episode, Bloomberg News reporter Carmen Arroyo looks at why the bonds had the best start of the year ever, while Mike Holland of Bloomberg Intelligence digs deeper into the healthcare sector.See omnystudio.com/listener for privacy information.

Borrowers and investors in the $1.4 trillion leveraged loan market are battling over the looming switch to SOFR from Libor, with buyers complaining that they don’t have a say on the new rates being applied. In this episode of the Credit Edge Podcast, Bloomberg News senior editor James Crombie is joined by leveraged finance reporter Paula Seligson to detail what the switch means. Bloomberg Intelligence analyst Jaimin Patel also provides a status update on the Latin America energy sector.See omnystudio.com/listener for privacy information.

Retail companies are tumbling into bankruptcy as consumers pull back, pressured by inflation, and debt costs soar. In this episode, Bloomberg News team leader Claire Boston weighs the outlook for US retailers, while Arnold Kakuda of Bloomberg Intelligence takes a deep dive into the banking sector.See omnystudio.com/listener for privacy information.

Buyers of repackaged loans are fighting to stop Libor transition costing them millions of dollars, while Twitter has some hefty debt payments due. In this episode, Bloomberg News reporter Paula Seligson digs into the biggest credit stories of the week, while Robert Schiffman of Bloomberg Intelligence takes a deep dive into the technology sector.See omnystudio.com/listener for privacy information.

Junk-rated companies rushed to sell bonds at the start of the year as risk assets rallied. In this episode, Bloomberg News reporter Olivia Raimonde looks at the opportunity for borrowers and the risks to investors as the economy slows, while Stephen Flynn of Bloomberg Intelligence digs into the communications sector.See omnystudio.com/listener for privacy information.