Repricings have been a fact of life in the bank loan market for a while, but while there's little doubt that they can be good news for the issuer, they are beginning to irk investors, who are tiring of seeing coupons slashed by more than a third, Libor floors sliced in half and pricing grids being added to deals.
"We're in a period of reprice discovery," said Randy Schwimmer, head of capital markets at Churchill Financial. "Repricings are what distinguish loans from bonds. Issuers always look to mark to market when spreads tighten, just as investors tried to improve yields when liquidity was scarce. But the market will push back if an issuer overreaches."