Precarious high-yield refinancings show the strain

Sovereign stress might limit refinancings; Covenant threat from revolvers

Joe Swanson, co-head of European restructuring at Houlihan Lokey in London

“With final maturities approaching fast, we are likely to see banks push equity holders to come up with sensible de-risking strategies for cases where refinancing is not an option”

Joe Swanson, Houlihan Lokey

The eagerness with which high-yield investors have embraced some of the more challenging credits in Europe could soon come back to haunt them. There are signs that some high-yield refinancings have simply placed too great a debt-service burden on their recipients and cracks have begun to appear.