LONDON - Panelists at last week's Loan Syndications and Trading Association (LSTA) gathering in London said an LCDX Index product is in development and should be ready for launch in the next six to eight weeks.
The Index will consist of 100 names and be cash settled. First lien loans will be listed as deliverable obligations. Deliverable obligations will be defined as they are with the single-name product, which is by the syndicated secured list (SSL). Only references that are eligible for inclusion on the SSL could be included in the LCDX. The only credit events for these products will be a borrower's failure to pay and bankruptcy. A five-year coupon will be initially set to help focus on liquidity at that maturity, panelists at the conference said.