Lending & Secured Finance 2024

1. Introduction

High-yield bond issuers watched as access to the market improved significantly during the last year, with global issuances increasing by two-thirds in 2023 from 2022 in terms of volume and with the first quarter of 2024 expected to be the busiest since mid-2021. Nonetheless, the market in 2023 was still just a third of the size as that in 2021, and despite interest rate spreads that have materially tightened over risk free rates, the cost of refinancing can be significantly higher for those companies that incurred debt during the low-rate environment of 2021 and prior. These companies are now operating in the third year of a higher-rate environment, making management of cash flows and debt maturities more challenging. High-yield issuers facing refinancing walls or otherwise in need of capital restructuring may continue to find that exchange offers and other liability management transactions are an attractive alternative to new money issuances.