In late May and early June, FocalPoint surveyed approximately 100 middle market lenders on the state of Capital Markets in the wake of COVID-19. The survey focused on what lenders observed in the prior month as well as their outlook and expectations. The results, presented in this report, reflect not only justified concerns, but more importantly growing optimism and a thaw in the markets.
FocalPoint surveyed approximately 100 banks and and non-bank cash flow and ABL lenders and found that a majority are more optimistic now than 30 days ago. Lenders are more optimistic in no small part due to a resurgence in deal flow, especially from financial sponsors. Lenders cite deal flow drivers as primarily refinancing debt (45% of respondents) and private equity sponsors making investments in new LBOs and add on acquisitions (21% and 17% respectively). Moreover, communication and cooperation between borrows, lenders, and sponsors, plus capital from PPP have boosted optimism. This positivity, combined with strong primary market deal flow, suggest lenders have started to refinance debt and support acquisition opportunities.
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FocalPoint has one of the largest dedicated Capital Markets teams in the middle market. Our deep relationships with hundreds of middle market lenders allows us to navigate any given capital raise process with confidence and precision.
Contact one of our Capital Markets Specialists to discuss this report or to learn more about FocalPoint's Capital Markets practice.
Thomas Mills, Managing Director
Michael Brill, Managing Director
Learn more about FocalPoint's Capital Markets Practice