European leveraged finance issuance (leveraged loans and high yield bonds) decreased in 2Q’15 to EUR 55.0 billion, a 4.8% decrease quarter-over-quarter (q-o-q) and a 41.2% decrease from a record setting EUR 93.5 billion in 2Q’14. The quarterly decrease stems from the large fall in high yield bond issuance, which decreased by 15.6% in the second quarter of 2015 while the leveraged loan issuance increased by 12.4%; the high yield share of the leveraged finance market decreased to 54.2%, down from 61.2% in 1Q’15.

Leveraged loan issuance, including first lien, second lien, and mezzanine financing, increased in the second quarter of 2015 to EUR 25.2 billion, up 12.4% q-o-q (EUR 22.4 billion) but down 28.9% y-o-y (EUR 35.4 billion). Amend-and-extend (“A&E”) transactions not only continue to take place but accounted for over half of deals in the second quarter of 2015 (EUR 14.7 billion or 58.4% by euro amount), a 143.3% increase from the first quarter’s EUR 6.0 billion.

Primary issuance in 2Q’15 totalled EUR 29.8 billion on 55 deals, a decrease of 15.6% and 48.7%, respectively, from 1Q’15 and 2Q’14. Issuance from developed market Europe decreased in the second quarter of 2015 while the issuance from emerging market Europe increased.

Primary issuance in developed market Europe in the second quarter of 2015 was EUR 29.6 billion on 54 deals, a 15.9% and 48.2% decrease by euro amount, respectively, from 1Q’15 (EUR 35.2 billion on 60 deals) and 2Q’14 (EUR 57.2 billion on 102 deals). In emerging market Europe primary issuance in 2Q’15 was EUR 0.15 billion on 1 deal, an increase of 124.8% but a decrease of 83.2% by euro amount, respectively, from 1Q’15 (EUR 0.07 billion on 1 deals) and 2Q’14 (EUR 0.9 billion on 3 deals).

About the Report

Done in partnership with AFME High Yield Division, the AFME Leveraged Loan and High Yield report is a quarterly report on the trends and statistics of the European leveraged finance market, including both high yield loans and leveraged loans. Issuance volumes, credit trends, global comparative issuance data, market highlights and commentary are included.

For more information on AFME’s efforts in the European leveraged finance sector, please visit AFME.

Credits

AFME

• Director, Capital Markets: Gary Simmons

SIFMA Research

• Managing Director, Director of Research: Kyle Brandon
• Senior Associate: Justyna Podziemska