Zanders strengthens its Debt Advisory Services

Zanders strengthens its Debt Advisory Services

In this quarterly update on our Debt Advisory Services, we share our thoughts and views on current trends and developments in the funding market, and give you an update on our services.  

LMA associate member

In early February 2014, Zanders became an associate member of the LMA (Loan Market Association). The LMA was initiated to assist the development of the secondary loan market in Europe. At the moment its key objective is to improve liquidity, efficiency and transparency in the primary and secondary loan market.

Our LMA membership will strengthen our knowledge on upcoming regulatory and legal changes and will support the efficiency and quality of our debt advisory services. Especially with regards to loan documentation, we see clear benefits from our collaboration with the LMA. At this moment Zanders is the only independent treasury and corporate finance advisor with an LMA membership.

Current trends and developments

Currently we see a solid window of opportunity for refinancing in the debt capital markets as well as through bank financing. Yields on corporate debt are still attractive. Corporate yields are relatively low despite tapering of quantitative easing. Below is an overview of corporate spreads (industrials) for the past three years.

Corporate credit spreads

Through our ongoing conversations with banks and current debt advisory assignments, we have witnessed an increasing lending appetite at the banks. Even though some sectors still find it challenging to arrange financing, generally banks are taking an increasing number of loans on their books. Besides direct communication from banks indicating that they are eager to have a stake in certain syndicates or club deals, we also find confirmation of these messages in received term sheets, showing very competitive pricing compared to the debt capital markets.