James Cretella : What Lenders Should Watch for in Today’s Tightening Credit
As credit markets become more selective, lenders are facing a more complicated environment when negotiating credit facilities. Higher borrowing costs, tighter liquidity, changing borrower profiles, and increased scrutiny around risk are making the negotiation process more important than ever. Lenders can no longer focus solely on pricing and repayment schedules. They also need to carefully evaluate the protections, flexibility, and risk allocation built into each credit facility. For lenders, today’s environment creates both challenges and opportunities. A well-negotiated credit facility can provide stronger downside protection while still giving borrowers enough flexibility to operate and grow. Understanding where risks are emerging and which provisions deserve closer attention can help lenders make better decisions and build credit agreements that remain resilient when market conditions change. Borrower Credit Quality and Cash Flow Resilience One of the first areas lenders should exa...