Bond Concessions Vanishing in Investor Squeeze: Credit Markets
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Corporate borrowers in the U.S. are squeezing investors as record-low interest rates and a lack of high-yielding alternatives force bondholders to accept the smallest premiums on new debt sales since March.
Yields on new bonds fell to within 15 basis points, or 0.15 percentage point, of existing securities on average last month, according to data from JPMorgan Chase & Co., the biggest underwriter of the debt. The new-issue premium is approaching the lowest level since the credit crisis began in mid-2007.