Live Oak Capital

There has been little change in lenders’ attitudes since last week.  Leveraged financing is still available for borrowers with strong financials and stable properties in primary locations. Weak borrowers and properties in secondary and tertiary areas still struggle to find financing.

During the past week, five-year Treasuries dropped 26 bps and 10-year Treasuries dropped 9 bps due to investors seeking the relative safety of government debt after a report showing U.S. retail sales fell the most on record in October. The three-month Libor rate rose for the first time after falling sharply during the past three weeks, telegraphing market concerns about the U.S. Treasury’s about face on the Troubled Asset Relief Program (TARP) to buy troubled assets. Two-year U.S. swap spreads widened to 116.50 bps this week from about 101 bps a day earlier, signaling investors’ risk aversion is rising.