European loan market down but not out

June 17, 2009

Much has been made recently of the drop in activity in European loan market activity and the corresponding boom in bonds and equities, which was recently highlighted by Reuters columnist Alexander Smith in this article.

But while the loan market is undoubtedly down, it is far from out. The flow of bond and equity issuance is feeding cash back into the loan market, and liquidity has clearly improved in the last month, allowing a number of deals to close oversubscribed.

I wrote this story summarising the stronger tone in the market and highlighting the relationship between the loan market and M&A financing which could quickly boost loan volume when M&A activity picks up.

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