Leveraged Loan Market Remains Cautious Heading into 2024

Although 21% of lenders expect the leveraged credit market to ease in 2024, a plurality believe conditions will remain similar to 2023, according to a recent FTI Consulting survey of nearly 250 leveraged loan professionals. Furthermore, only 12% predict more relaxed underwriting standards, with most expecting them to remain largely unchanged over the next year. There was cautious optimism in the leveraged M&A market, with 38% of respondents expecting a “modest improvement” in deal activity. Non-bank lenders expected higher leveraged M&A activity than their bank lending counterparts.