US CREDIT SUPPLY: Goldman Sachs Priv Credit (GSBD) $300m Long 5Y - Fair Value
NEW DEAL: Goldman Sachs Private Credit $300m Long 5Y - +262.5 Area - Fair Value
(GSBD; Baa3/NR/BBB-)
• $300m Long 5Y Fixed (Jan. 31, 2031) IPT +262.5 Area - FV +230a
• We comp GSCRED to other larger private BDCs including ARESSI, SIXSLP and OCINCC.
• We note the relationship between public and private BDCs varies, between 20-30+bps. In the case of OCINCC it actually is trading through the public OBDC due to recent noise around a merger.
• If we use the public private spread relationship (above) we should see 5Y GSCRED at +230a, our FV. GSBD 5.65%'30s are trading +190a
• Issuer: Goldman Sachs Private Credit Corp (GSCRED)
• Format: 144A/Reg S with reg rights, senior unsecured
• UOP: To repay a portion of the outstanding indebtedness under the Company’s Credit Facilities and for general corporate purposes.
• Bookrunners: BofA, MS, SMBC, TSI, WFS (B&D)
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EGBS: BTP/Bund Spread Near Session Lows, Growth Data Key To Further Narrowing
The 10-year BTP/Bund spread trades close to session lows of ~78.5bps, benefiting from the latest extension higher in global equity futures.
- We highlighted last week that having already tightened by ~35bps this year, the 10-year BTP/Bund spread has struggled to sustainably consolidated below 80bps in recent months.
- Signs of a more resilient domestic growth outlook may be a necessary condition for further narrowing. Although the 2026 draft budget projects the Italian deficit to fall to 2.8% next year, a weak growth trajectory may impede continued improvements in fiscal metrics. Q3 flash GDP is due on October 30.
- Note that EUR 3m10y swaption vol has also moved away from multi-year lows through October, which may be limiting near-term tightening impulses.
- BTP futures are +7 ticks at 121.53, off session lows of 121.58. Initial resistance is Friday’s opening high of 121.94.
- Italy is issuing the new retail-only 7-year Oct-32 BTP Valore this week. Day 1 books are currently E4.9bln. That’s above the E3.7bln raised on the first day of the last BTP Valore issue in May 2024, but currently below the E5.6bln raised on the first day of the BTP Piu issue in February 2025.
BOC: Canada Consumer And Business Inflation Views Soften But Remain Elevated
- Firms expecting inflation exceeding BOC target rate declined from 74% in Q2 to 69% in Q3.
- Two-thirds of consumers foresee a recession within a year, blaming trade war, yet also see inflation at 3.72% now and 4% a year from now.
- CSCE indicator -0.85 from prior -1.07; remains below historical levels.
- 70% of consumers believe the worst inflation spill-over is yet to come from tariffs.
- Surveys mostly gathered from July through Sept. BOC has said it will remain cautious on interest rates after a return to cutting last month.
MNI: BOC OUTLOOK SURVEY: FUTURE SALES GROWTH BALANCE OF OPINION -2
- MNI: BOC OUTLOOK SURVEY: FUTURE SALES GROWTH BALANCE OF OPINION -2
- BANK OF CANADA BUSINESS OUTLOOK SURVEY OVERALL INDICATOR -2.28
- BOC: CONSUMERS SEE INFLATION AT 3.72% NOW, 4% IN 1 YEAR
