Kenny Tang
- Indexed articles, last 90 days
- 3
- Latest publication
- Aug 7, 2026
- Outlet visibility, for yahoo.com
- Top 1K sites
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- Jul 10, 2026
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Leveraged loan default rate sticks below 1% in July; distress ratio edges higher (opens the original)
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While the leveraged loan default rate remained below 1% in July, the secondary market is sending a signal that trouble may be brewing. The distress ratio, which is defined as the share of loans trading below 80 cents on the dollar, rose to 6.89% in July. The ratio has now been above 6.25% for the past six months, suggesting a growing pipeline of potential candidates for liability management exercises (LMEs). There were no payment defaults reported in the Morningstar LSTA US Leveraged Loan Index
July Wrap: Software, insurance sectors lead loan rally (opens the original)
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The US syndicated loan market returned 0.79% in July, its best-performing month since April, as software loans and insurance credits rebounded. A large divide still exists between software and the broader market, however, and the distressed and stressed cohorts remain elevated. Loans returned 0.79% in July, according to the Morningstar LSTA US Leveraged Loan Index, the second-strongest showing in 12 months, led by the software and insurance sectors. Performing software loan prices gained 81 bps,
Leveraged loan default rate dips below 1% in June, though distress ratio rises (opens the original)
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The leveraged loan default rate by amount declined sharply in June, falling to 0.97%, from 1.35% in May, as there were no defaults during the month to impact the rolling 12-month calculation. The drop was driven largely by SFR's June 2025 default falling off the legacy default list. SFR, a telecom company and affiliate of Altice France, accounted for roughly $5.65 billion of term debt included in the Morningstar LSTA US Leveraged Loan Index (LLI) at the time of its default. By issuer count, the
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