- Leveraged finance is an area of banking used by private-equity firms to raise debt for acquisitions or recaps.
- High-yield bond and leveraged loan markets have reached a collective $3 trillion.
- Insider talked to the top levfin bankers driving the boom to learn more about their careers and outlook.
- See more stories on Insider's business page.
Leveraged finance, an area of banking typically used by private-equity firms to raise debt for acquisitions or recapitalizations, is in the midst of a "golden age," according to Jeff Cohen, the head of leveraged and acquisition finance at Credit Suisse.
Cashed-up private-equity firms from KKR to Blackstone are making a spate of acquisitions amid attractive conditions for borrowers - thanks to rock-bottom interest rates. Investors starved of meaningful yield in the fixed-income markets, meanwhile, are more willing to buy riskier, leveraged loans and high-yield bonds in their search for returns.
In light of this backdrop, high-yield bond and leveraged loan markets have reached a collective $3 trillion, according to S&P Global Market Intelligence. Fees vary depending on the type of transaction, but sources said banks are on track to pocket a minimum of $7.5 billion in leveraged-finance transaction costs this year.
Subscribers can keep reading here: Meet top bankers behind a new 'golden age' of mega buyouts who are poised to rake in billions in fees this year
Insider talked to some of the industry's stalwarts, as well as smaller shops that are looking to climb the rankings and disrupt the Wall Street status quo. These are their stories, as well as what they're seeing in the leveraged finance market and their predictions for what lies ahead.