Loan issuance was €5.4 billion in November 2013, while high yield issuance was €7.4B. Both markets are buoyant and open. Secondary markets were up, inflows into high yield funds are estimated to be €1B. The ELLI was up. Four CLOs priced in November, with seven still in the pipeline. Check out LCD's new, free web sites, LeveragedLoan.com and HighYieldBond.com http://www.leveragedloan.com http://www.highyieldbond.com/ * Job postings * Online Loan Market and High Yield Primer * News and analysis * Market Stats Video presentation of these slides: http://youtu.be/FZkQG4dzuek Connect with LCD Facebook: http://www.lcdcomps.com/facebook Like LCD on Facebook for monthly analysis on LBO/Private equity stats, as well as Default/Restructuring analysis. LinkedIn: http://www.lcdcomps.com/linkedin There are over 10,000 market contacts in LCD's Leveraged Loan Group Twitter: http://www.twitter.com/lcdnews News, commentary, other leveraged finance info Web: http://www.lcdcomps.com Contact: anna_cini@sandp.com

1. Text
European Leveraged Finance Market Update
December, 2013
Sucheet Gupte - Director

2. European Market Trends
Text
• Loan issuance was €5.4B in November 2013, while high yield issuance was €7.4B for the month.
• Secondary markets were up:
leveraged loan markets were up 27 bps to close at 100.73;
high yield markets were up 14 bps to finish 105.33.
• Inflows into European high yield funds for November are estimated to be €1B, bringing
the estimated year-to-date number to an enormous €6.3B.
• The S&P European Leveraged Loan Index (ELLI) was up for November, with returns at 1.18%.
• 4 CLOs priced this month, bringing monthly issuance to €1.62B and year-to-date issuance to €6.45B.
• Default rates were higher even though no new issuers defaulted (the overall par amount outstanding
in the ELLI decreased).

3. European Loan Flow Name Prices
101
99
Text
98
96
94
93
91
3/11
.
5/11
7/11
Source: S&P Capital IQ/LCD
9/11
11/11 1/12
3/12
5/12
7/12
9/12 10/12 12/12 2/13
4/13
6/13
8/13
11/13

4. European HY Bond Flow Name Prices
106
102
Text
98
94
89
85
81
3/11
.
5/11
Source: Bloomberg
7/11
9/11 11/11 1/12
3/12
5/12
7/12
9/12 11/12 1/13
3/13
5/13 6/13
8/13
11/13

5. ELLI Multi-Currency Loan Return
1.5%
Text
November 2013:
October 2013:
Jan-Nov 2013:
Jan-Nov 2012:
+ 1.18%
+ 1.02%
+ 8.21%
+ 8.70%
1.0%
0.6%
0.1%
-0.4%
11/12
.
12/12
1/13
2/13
Source: S&P European Leveraged Loan Index
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/13
11/13

6. Volume: New-Issue Loans vs. HY Bonds
18
HY bonds
Text
Loans
€billions
14
€7.4B
9
5
€5.4B
0
11/12
.
12/12
1/13
Source: S&P Capital IQ/LCD
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/13
11/13

7. ELLI Default Rates – European Leveraged Loans
Default Rate by Principal Amount
Default Rate by Issuer Count
16%
16%
13%
13%
10%
10%
Text
6%
6%
3%
0%
2/09
.
3%
0%
2/09
2/10
2/11
Source: S&P Capital IQ/LCD
12/11
11/13
2/10
12/11
2/12
11/13

8. Themes To Watch For
Text
• Both the high yield market and leveraged loan market are buoyant and open,
with the loan market currently having a slight edge.
• Issuers will also look to tap the US market for both loans and high yield bonds
in finding the best execution.
• The CLO market is still strong, with seven transactions still in the pipeline.
Anecdotal evidence suggests that managers are seeing inflows into global loan
accounts.

9. Text
Text
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