Moody’s Talks – Behind the Bonds – Details, episodes & analysis

Moody’s first Private Credit Outlook predicts that this market will double by 2028 to more than $3 trillion of assets under management. Private credit should benefit from more volatile market conditions and from innovation which is attracting new kinds of customer but also generating new risks.

Later in the episode, we look in depth at the surge in retail investor involvement in private credit.

Guests: Marc Pinto, Managing Director, Corporate Finance Group, Moody’s Ratings; Christina Padgett, Associate Managing Director, Corporate Finance Group, Moody’s Ratings; and Alexandra Aspioti, Senior Analyst, Corporate Finance Group, Moody’s Ratings

Host: Tania Hall, Senior Research Writer, Moody’s Ratings

To read more on this topic, visit Behind The Bonds page on Moodys.com (some content only available to registered users or subscribers).

Related research:

• Private Credit — Global: 2025 Outlook – Primed for growth as LBOs revive, ABF opportunities accelerate
• Financial Institutions – Europe: Revamped ELTIF legislation unlocks growth for the European private credit market
• Business Development Companies – US: Q3 2024 Update: Rate cuts will further erode net investment income; rise in nonaccruals pauses
• Financial Institutions – North America: Private credit ETFs will use public credit for liquidity, a potential performance challenge

The outlooks for corporates in North America, Latin America, China, Asia-Pacific and EMEA are now all stable. We discuss the drivers shaping those outlooks and the similarities and differences across regions. Then we’re taking a deeper dive into the improving credit fundamentals for global leveraged finance next year as interest rates decline and defaults ease.

Guests: Paloma San Valentin, Managing Director - North America Corporate Finance , Moody’s Ratings and Jeanine Arnold, Senior Vice President – Senior Analyst – Corporate Finance Group, Moody’s Ratings

Host: Jeff Pruzan, Vice President – Senior Research Writer, Moody’s Ratings

To read more on this topic, visit Behind The Bonds page on Moodys.com (some content only available to registered users or subscribers).

Related research:

• Leveraged Finance – Global: 2025 Outlook – Improving credit conditions will boost deal flow, but risks to persist
• Nonfinancial Corporates – Latin America & Caribbean: 2025 Outlook – Stable on mixed growth, but operating environment implies hazards
• Nonfinancial Corporates – EMEA: 2025 Outlook - Stable on lower rates, moderate growth, but geopolitics weigh
• Nonfinancial Corporates – Asia-Pacific ex China (APAC): 2025 Outlook – Stable on growth, easing interest rates, despite geopolitical tensions
• Nonfinancial Corporates – China: 2025 Outlook – Stable amid stronger stimulus, but geopolitical risk has climbed
• Nonfinancial Corporates – North America: 2025 Outlook - Stable as inflation wanes but stressed consumers, geopolitics add risk

Artificial Intelligence or AI is predicted to have a profound impact on many areas of business. In this episode of Behind the Bonds we assess where AI innovation is already showing significant potential. Which industries can expect to see improved productivity and what are the potential timelines for any positive impact on credit quality? We also discuss the disruptive potential of these new technologies and the risks to jobs.

Later in the episode our colleagues look in more depth at the media, where AI’s potential is presenting opportunities and generating both opposition and collaboration from content creators.

Guests: Francesco Bozzano, Vice President – Senior Analyst, Global Corporate Finance Group and Agustin Alberti, Vice President – Senior Analyst, Global Corporate Finance Group.

Host: Tania Hall, Senior Vice President – Senior Research Writer, Moody’s Investors Service.

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)

Related Research:

• Nonfinancial corporates – Global: Market leaders in data-rich sectors will gain most from AI advances
• Digital Transformation – Global: 2024 AI Outlook – Swift progress likely but rapid roll-out will bring risks
• Media & Publishing – Cross Region: GenAI should benefit media companies, mainly by boosting productivity

In 2024 we see an uneven picture for companies across the globe. For those in North America and Asia-Pacific, excluding China, the credit outlook is stable. But in Europe, the Middle East and Africa, and Latin America the outlook is negative. Driving this testing global environment are higher for longer interest rates which are raising the cost of borrowing and re-financing. This is a particular challenge for speculative-grade companies. Higher rates are also weighing on consumer demand in some sectors, particularly real estate.  

Later in the episode at 11.30mins, our colleagues in Hong Kong take a closer look at prospects for companies in China, in recent decades the driver of the global economy, but facing a negative credit outlook for 2024. 

Guests: Myriam Durand, Managing Director, Global Corporate Finance Group and Gloria Tsuen, Vice President, Senior Credit Officer, Global Corporate Finance Group. 

Host: Jeff Pruzan, Vice President – Senior Research Writer, Moody’s Investors Service.   

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)  

Links: 

Global Outlook Segment

• Nonfinancial Companies – North America: 2024 Outlook - Stable on relatively robust growth, even as high rates drive risk
• Nonfinancial Companies – APAC ex China: 2024 Outlook - Stable on sustained growth in large, domestic-focused economies
• Nonfinancial Companies – EMEA: 2024 Outlook - Negative as higher rates bite and consumers remain cautious
• Nonfinancial Companies – Latin America & Caribbean: 2024 Outlook - Negative amid high rates, slow growth and subdued commodity prices

China Segment

• Nonfinancial Companies – China: 2024 Outlook - Negative amid lower growth and prolonged property downturn
• Cross Sector – China: China will be more selective in providing support to state-owned enterprise
• Cross Sector – China: Slowing growth intensifies spillover effects of long property market downturn
• Macroeconomics– China: Medium-term growth outlook will reflect effectiveness of economic rebalancing   
• Credit Conditions – China: Soft economic recovery heightens contingent liabilities from LGFV debt risks

This year has been a very weak one for leveraged finance deals as aggressive global monetary tightening hit markets. In this episode we explain why we see a gradual improvement in 2024, with refinancings driving new issuance in the US and EMEA. 

Guests: Chris Padgett, Associate Managing Director of North America Leveraged Finance Research and Jeanine Arnold, Senior Vice President of Leveraged Finance, EMEA. 

Host: Tania Hall, Senior Vice President – Senior Research Writer, Moody’s Investors Service.

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.) 

Related Links:

• 2024 Outlook – Growing refinancing needs, higher-quality LBOs, will drive new issuance

Retailers in North America and Europe are looking forward to another bustling holiday shopping season—but consumers may not be as eager this year as stores have hoped amid fairly high inflation, even with a strong labor market. Will 2024 get any better for retailers and makers of apparel? Later we look at the global transport sector—where container shipping continues to struggle, even while other modes of transportation look for improved earnings in 2024.

Guests: Christina Boni, Senior Vice President; Mickey Chadha, Vice President-Senior Credit Officer; and Daniel Harlid, Vice President-Senior Credit Officer, all from the Corporate Finance Group of Moody’s Investors Service.

Host: Tania Hall, Senior Vice President – Senior Research Writer, Moody’s Investors Service.

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)

Related Research:

• Retail & Apparel – Global: Recovery delayed to 2024 as inflation fatigue hurts spending; outlook still stable
• Retail & Apparel – Global: Outlook is stable as profits set to recover from lower costs and inventory realignment
• Retail – US: Stronger than expected September retail sales pushes Q3 higher, but year to date spending remains muted
• Retail & Apparel – EMEA: Quarterly Update: Trading conditions remain difficult despite some retailers' positive results
• Transportation – Global: Outlook stable despite weakening business conditions for container shipping
• Shipping – Global: Tougher Panama Canal drought restrictions will have mixed credit effects for shipping
• Macroeconomics – US: US GDP revisions confirm economic resilience, but consumer spending momentum dipped in Q3

Private credit lenders built stores of capital that we expect will be put to work competing with banks to fund a new wave of leveraged buyouts. In the first segment of this episode, we discuss LBO competition and the risks it poses. Later, our guest lays out the concentration of private credit among a handful of giant asset managers building their own, largely self-contained lending ecosystems.

Guests: Christina Padgett, Associate Managing Director and Sandra Veseli, Managing Director, both from Moody’s Investors Service’s Corporate Finance Group; and Rory Callagy, Associate Managing Director, with Moody’s Financial Institutions Group.

Host: Jeff Pruzan, Vice President – Senior Research Writer, Moody’s Investors Service.

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)

Links:

• Private Credit – Global: Syndicated and private lenders will spar as LBOs revive, upping systemic risk

Big technology companies have been on a wild ride over the past few years, with the pandemic-driven boom followed by an inevitable hangover as economic uncertainty loomed. In the first segment of this episode, we examine the outlook for the global diversified information technology sector over the next 12-18 months. Then at 10.02 we discuss how the European Chips Act will help the region’s semiconductor manufacturers in the face of stiff competition from other parts of the world.

Guests: Raj Joshi Senior Vice President and Dirk Goedde Vice President-Senior Analyst - Corporate Finance Group, Moody’s Investors Service. 

Host: Tania Hall Senior Vice President – Corporate Finance Group, Moody’s Investors Service. 

To read more on this topic, visit The Big Picture page on Moodys.com (some content only available to registered users or subscribers). 

Airlines and airports are benefitting from booming demand from leisure travellers as people take to the skies for a well-deserved summer holiday. In the first segment of this episode, we look at what’s driving strong passenger traffic volumes at US and European airports and what operational challenges lie ahead. And then we explore the tailwinds keeping our outlook for the global airline industry positive for the next 12-18 months.

Guests: Earl Heffintrayer, Vice President and Joanna Fic, Senior Vice President, both from Moody’s Investors Service’s Public Project and Infrastructure Finance Group; and Jonathan Root, Senior Vice President, Corporate Finance Group.

Host: Jeff Pruzan, Vice President – Senior Research Writer, Moody’s Investors Service.

To read more on this topic, visit Moodys.com. (Some content available only to registered users or subscribers.)

• Airports – US: Pandemic-driven traffic gains will hold in areas with population growth and tourism
• Airports – Europe: Passenger volumes will continue to rise this summer, but regional differences persist
• Airlines – Global: Outlook still positive as passenger demand extends recovery amid capacity constraints

Moody’s analysts discuss the economic and credit outlook for China, including the role of local government financing vehicles (LGFVs) and their debt burdens, and the latest on the property sector.

Speakers: Lillian Li, VP-Senior Credit Officer, Moody’s Investors Service; Jessie Tung, VP-Senior Credit Officer, Moody’s Investors Service

Host: Vittoria Zoli, Analyst – Emerging Markets, Moody’s Investors Service