Introduction: A Surge in Leveraged Lending

The leveraged lending market is experiencing explosive growth heading into 2025, driven by a combination of lower interest rate expectations, increased private credit inflows, and shifting risk appetites among institutional investors. Leveraged loans—defined as loans extended to companies with high debt-to-EBITDA ratios or below-investment-grade credit ratings—have become an increasingly dominant force in corporate finance, particularly in the middle market.