Years of easy money allowed overleveraged companies to postpone difficult decisions.
According to executives at Oaktree Capital, that period may be ending.
Speaking on Oaktree's latest The Insight podcast, Brook Hinchman, head of North America for Oaktree's Opportunistic Credit Strategy, and Matt Wilson, co-portfolio manager for its Special Situations Strategy, argued that a "higher-for-longer" interest-rate environment is beginning to expose vulnerabilities across parts of the credit market.
But they also see the conditions creating one of the richest opportunity sets for distressed investors in years.
"The opportunity here if it stays higher for longer is that we're going to see the opportunity to purchase meaningful amounts of distressed debt and/or provide capital solutions," Wilson said.
