Wall Street banks improve leveraged loan terms amid market volatility

From Yahoo Finance: 2025-03-21 15:34:00

Wall Street banks, including JPMorgan Chase & Co. and Morgan Stanley, are making investor-friendly changes to leveraged loan offerings amid global market uncertainty surrounding President Trump’s policies. Borrowers are offering bigger discounts on new loans, with secondary market prices dropping to 96.45 cents on the dollar.

JPMorgan raised the interest rate on a Natgasoline loan offering by 75 basis points and lowered pricing to 97 cents on the dollar. The $525 million loan’s commitments are due Monday and will refinance debt for the methanol production company. Moody’s analysts cite volatile methanol prices and global growth concerns.

Morgan Stanley and other banks made investor-friendly changes to a $2.5 billion loan offering from Vista Equity’s Avalara Inc., including removing anti-cooperation language and adding asset protection provisions. Bank of America widened pricing and delayed a $2.4 billion loan for Level 3 Financing, impacting recent deals in the US and Europe.

President Trump’s policies have rattled markets, leading to uncertainty in deal activity and leveraged loans. Banks are facing market turmoil, while private credit firms offer aggressive terms to win deals. Credit spreads on private loans are at historic lows, with lenders willing to add leverage and accept dividend recapitalizations to remain competitive.

Read more: Wall Street Banks Sweeten Leveraged Loan Terms Amid Volatility