Neil Unmack is a Reuters Breakingviews Associate Editor based in London. He covers credit markets, hedge funds, and Italy. Previously he was a corporate finance reporter at Bloomberg News in London. He started his career as a financial journalist in 2001 at Euromoney Institutional Investor, where he covered structured finance for EuroWeek magazine. He was educated at Eton College and Oxford University, graduating with a first class degree in modern languages.
A weak economy, high debt and falling profits should mean more corporate defaults in 2020. The pain will fall particularly on lenders specialising in private loans, who have $278 billion of assets under management. Rising losses will sort the sheep from the goats.
The $1 trln market for bonds backed by leveraged loans has fuelled the boom in private-equity dealmaking. A weaker economy will make investors wary of buying these so-called CLOs, and force vehicles to curb lending. That means higher borrowing costs, and probably fewer takeovers.
Voters in the United Kingdom face their third big electoral decision in less than four years. The result has major implications for companies, financial markets, fiscal policy, relations with Europe and the future of the union. Breakingviews tots up the possible consequences.