Fitch: U.S. Leveraged Finance Markets Maintain Upward Momentum in Third Quarter

CHICAGO--(Business Wire)--
The U.S. leveraged finance markets continued its streak of increased levels of
issuance and solid performance during the third quarter of 2009 (3Q'09),
according to Fitch Ratings. Following record-breaking performance in 2Q'09,
yield spreads continued to narrow, generating positive returns to investors for
the third quarter in a row.

"Generally improving economic data and better-than-expected corporate earnings
are encouraging investors to move back into riskier asset classes," said Eric
Tutterow, Managing Director, Fitch Ratings U.S. Leveraged Finance.

New high yield bond issuance totaled $38.9 billion during 3Q'09, down 25.1%
compared to $51.9 billion issued during 2Q'09, but still up significantly
compared to the previous seven quarters. Approximately 37.4% of new high yield
issuance was in the form of secured notes.

Issuance in the U.S. leveraged loan market also declined during 3Q'09 compared
to 2Q'09 with total syndicated loan issuance of $95.1 billion, down 40.4% from
$159.5 billion in 2Q'09. Leveraged loan issuance totaled $47.4 billion in 3Q'09,
down 32.5% from $70.3 billion in 2Q'09.

Of particular note is the ongoing increase in debtor-in-possession (DIP) loan
issuance, which reached $14 billion during the first three quarters of 2009. DIP
volume in 2009 has already exceeded the total DIP volume recorded during each of
the last eight years.

Fitch further notes that the overall pace of speculative-grade downgrades
declined again in 3Q'09. Pressure on credit quality overall has eased in recent
months, driven in part by lender willingness to amend and extend loans rather
than force them into a default, and increased credit availability in the public
markets.

The full 'U.S. Leveraged Finance Quarterly Review' is available on the Fitch
Ratings web site 'www.fitchratings.com.' Full comparative data on high yield
bond and loan data is available, as well as comparative performance trends.

Additional information is available at 'www.fitchratings.com'.

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Fitch Ratings
Brian Bertsch, +1-212-908-0549 (New York)
brian.bertsch@fitchratings.com
Eric Tutterow, +1-312-368-3218 (Chicago)
Darin Schmalz, +1-312-606-2324 (Chicago)
Tushar Makwana, +1-312-368-3265 (Chicago)

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