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The KPMG Debt Market Snapshot Edition Q2 2021 is here. With the aim of keeping you up to date on the latest developments and trends in Europe's financing markets, our Debt Advisory experts use current market data to discuss prominent market drivers and provide first-hand insights from daily practice. Read more in our most recent release.

As summer approached, vaccination rates started to rise alongside widespread easing of Covid-19-related restrictions across Europe. During these past few months, it has probably felt the closest to a return to normality since the outbreak of the pandemic: Entire sectors have sprung back to life and employees have returned to their workplaces, fuelling economic recovery. In the financing space this is reflected in strong market activity, with some segments reaching record highs in terms of volume and deal count. Nevertheless, with German inflation rising to rates not seen since the introduction of the HICP (harmonised index of consumer prices), still high unemployment rates and the race against time in the face of falling vaccination take-up rates and the advance of new coronavirus variants, uncertainty remains our constant companion.


  • As financing conditions developed favourably for borrowers, the leveraged loan market, just like the sponsored loan market, remained very active in Q2 2021, with both segments recording half-year figures that even managed to exceed the full-year volumes from 2019 and 2020.
  • The ECB maintains its expansive monetary policy stance to boost investment activity, causing corporate bond spreads to tighten even further in Q2. Average spreads for A-rated papers fell to 55 bps, the lowest seen in the past four years.
  • The sustainable financing markets are developing strongly, which is especially reflected in the increased volume of green/social/sustainability-linked bonds that, halfway through the year, already exceed the full-year volume raised in 2020. As a result, 2021 is well on the way to becoming a record-setting year as borrowers and lenders shift their focus towards sustainable financing strategies.

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