Leveraged Loans Dodge Existential Threat In New York Court

Davide Scigliuzzo
Bloomberg News
May 27, 2020, 10:37 AM

The $1.2 trillion leveraged loan market’s biggest players can breathe a collective sigh of relief -- at least for now. A New York judge last week dismissed a claim that a leveraged loan JPMorgan Chase & Co. and other Wall Street banks sold in 2014 could be considered a security and, as such, be subject to the same disclosure requirements as stock and bond offerings.

The suit was one of the most consequential threats faced by the market for risky corporate loans during its decades-long emergence from an arcane corner of bank lending into a major asset class whose...