Restructuring Corporate Debt - A Different Kind of Cycle

Abstract

The COVID-19 pandemic and its associated response have delivered a recessionary shock to the global economy. As with prior downturns, these forces have collided with a leveraged corporate sector and spurred an increase in financial restructuring activity. However, in many respects this restructuring cycle is unlike any other cycle that we have experienced. In this paper, we explore the unique aspects of this restructuring cycle, how they differ from those of past cycles, and what this implies for the future.

Keywords: restructuring, leverage, bankruptcy, credit