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- Blackstone Loan Financing’s first results under its new wind-down policy
Blackstone Loan Financing (BGLF) has released its annual results for the 12 months ending 31 December 2023.
Steven Wilderspin, BGLF’s char, commented:
“Markets recovered from a weak start and macroeconomic headwinds to record a strong year of performance across most asset classes in 2023. Rate volatility was a persistent theme throughout the year, as central banks continued to aggressively tighten policy, before eventually pausing during the second half. The rate volatility led to periods of market weakness through the year, including during March’s regional banking stress. Against this backdrop, resilient economic data and most corporate fundamentals offered hope of a soft landing in the near future, fueling a late year rally across markets.
“The S&P 500 ended the year at a near-record high, having gained 24% over the course of 2023. Credit markets also benefitted to a slightly lesser extent and loans, which are a natural interest rate and inflation hedge due to their floating rate nature, reversed their 2022 losses to record their best year since 2009.
“Looking ahead to 2024, we believe that floating rate loans and CLOs are likely to remain attractive asset classes, even if central banks pivot, given historically elevated all-in yields, robust corporate balance sheets and default rates remaining within historical averages. We continue to expect an ongoing bifurcation between issuers that are well positioned for slower growth, against those that are more at-risk of cyclical demand and consumer spending. As in any economic cycle, we believe that individual credit selection will be a key driver to performance throughout the year.”