Template-Type: ReDIF-Paper 1.0
Author-Name: Sirio Aramonte
Author-X-Name-First: Sirio
Author-X-Name-Last: Aramonte
Author-Name: Fernando Avalos
Author-X-Name-First: Fernando
Author-X-Name-Last: Avalos
Title: Corporate credit markets after the initial pandemic shock
Abstract: Corporate funding markets partially resumed after seizing up in mid-March 2020 - but at much higher spreads and with sharper sectoral differentiation.
In March, wide spreads for highly rated energy firms pointed to significant downgrade risk. Post-GFC leverage build-up amplified the damaging effects of financial stress during the pandemic. The unusually broad impact of the pandemic shock on lower-rated firms threatens CLO structures, though not as much as the bursting of the housing bubble undermined CDOs.
Length: 9 pages
Creation-Date: 2020-07-01
File-URL: https://www.bis.org/publ/bisbull26.pdf
File-Format: Application/pdf
File-Function: Full PDF document
File-URL: https://www.bis.org/publ/bisbull26.htm
File-Format: text/html
Number: 26
Handle: RePEc:bis:bisblt:26