BNP Paribas Flexi III European Senior Corporate Loans (\u2018the fund\u2019) is an open-ended fund structured as a
\nsub-fund of the Luxembourg-domiciled BNP Paribas Flexi III SICAV. It invests in senior secured corporate
\nloans, issued by primarily European borrowers and typically rated BB- or B+.<\/p>\n
The fund offers access to a significant area of opportunity within corporate credit, with the European syndicated loan market valued at around EUR450 billion (source: Credit Suisse, January 2016). <\/p>\n
Loans benefit from the highest level of seniority in the capital structure of corporate issuers and are secured by the assets of the borrower, meaning that recovery rates in the event of a default are generally high.<\/p><\/blockquote>\n
They pay a floating rate, consisting of a base rate (such as Euribor or Libor) together with a fixed interest margin, and offer insurers, pension funds and other institutional investors stable cash income generation and a hedge against inflation and interest rate risk, while providing diversification and shortening overall portfolio duration. For insurers in particular, they offer attractive risk-adjusted returns on capital within a Solvency II framework.<\/p>\n
The fund is managed by BNPP AM\u2019s Global Loans team, headed by Vanessa Ritter, consisting of 18
\ninvestment professionals, all with extensive corporate banking backgrounds, together with eight
\ndedicated middle office staff. The team is split between New York and Paris, and forms part of the 50
\nperson Private Debt & Real Assets investment group, established earlier this year under the leadership of
\nDavid Bouchoucha.<\/p>\nThe Global Loans team has recently hired two new credit analysts, based in Paris. Thomas Bruneel
\nfocuses on the automotive, building materials and gaming & leisure sectors. He re-joined from Moody\u2019s
\nInvestor Services, having previously worked in BNPP AM\u2019s Global Loans team in New York and Paris.
\nTanguy Godefroy focuses on the chemicals sector. He joined from BNP Paribas\u2019 Corporate Debt Platform,
\nwhere he was responsible for the origination, structuring, underwriting and execution of LBOs, leveraged
\ncorporate acquisitions and refinancings across EMEA.<\/p>\nWith more than ten years\u2019 experience of managing loan products, the team has a strong track record of
\ncredit selection and fund performance, combined with a low default rate and solid returns. Assets under
\nmanagement total EUR5.05 billion across a range of funds, dedicated single- and multi-investor mandates
\nand collateralised loan obligations (CLO 2.0). The team\u2019s first open-ended fund was launched in 2013.<\/p>\nJavier Peres Diaz, Head of European Loans at BNP Paribas Asset Management, comments: \u201cDefault rate expectations for the near term remain low, therefore the embedded cost of risk of the loan
\nmarket should stay quite limited. In light of this, senior secured loans are set to continue offering
\ncompelling risk-adjusted returns on both an absolute and a value-relative basis, despite the spread
\ncompression witnessed so far this year, which is reflective of the current supply\/demand imbalance.<\/p>\nStrong credit support factors, both macroeconomic and technical, should translate into low default rates
\nin the near future. Moreover, average interest coverage metrics suggest that issuers still have significant
\nflexibility to meet financial obligations, and refinancing needs are rather limited in the next few years.
\nStructural shifts in the way companies obtain longer-term financing, combined with improved secondary
\nmarket liquidity and attractive returns have resulted in growing institutional demand for loans. They
\noffer stable cash income generation and portfolio diversification, together with favourable treatment
\nunder Solvency II, all of which are supporting continued allocations by investors. With the launch of our
\nEuropean fund, we aim to help our clients meet their investment needs, while building on the success
\nthat our global strategy has enjoyed.\u201d<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"Building on the success of its global corporate loan fund, BNP Paribas Asset Management (\u2018BNPP AM\u2019) has launched BNP Paribas Flexi III European Senior Corporate Loans and appointed two new credit analysts.<\/p>\n","protected":false},"author":20,"featured_media":67316,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1471],"tags":[1655,1856,1859,1681,1651,1437,1691,1774,1952],"_links":{"self":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/67318"}],"collection":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/users\/20"}],"replies":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/comments?post=67318"}],"version-history":[{"count":0,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/67318\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media\/67316"}],"wp:attachment":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media?parent=67318"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/categories?post=67318"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/tags?post=67318"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}