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BofA CEO Warns of Leveraged-Loan ‘Carnage’ If Economy Slumps

June 4, 2019, 6:45 PM

The U.S. economy is on solid footing except for one potential trouble spot -- the leveraged-loan market, Bank of America Corp. Chief Executive Officer Brian Moynihan said.

“It’ll be ugly for those companies if the economy slows down and they can’t carry the debt and then restructure it, and then the usual carnage goes on,’’ Moynihan said June 4 at the Economic Club of New York. “We should worry about that,’’ particularly as loan terms have become more favorable to borrowers, he said. Still, the market is relatively small, which may mean that any shakeout is less likely to affect ...