US Companies Set Record for Debt Issuance Amid Growing Risks

American companies are setting new records for debt issuance, aiming to mitigate potential future risks.

According to the London Stock Exchange Group (LSEG), the first week of September saw an unprecedented 29 investment-grade bond deals in a single day, the highest number ever recorded. The following day, another $73 billion in debt was issued, marking the largest volume in two decades.

The record-breaking activity spans various sectors, with major issuances from companies like Ford Motor Credit, Target, and Uber.

While early September is usually a peak period for corporate borrowing, the surge is attributed to concerns about upcoming elections and other geopolitical uncertainties.

Dan Mead, head of Bank of America Securities’ investment-grade syndicate, explains that companies are advancing their debt issuance to reduce risk in anticipation of economic reports, Federal Reserve decisions, and election-related volatility.

Maureen O’Connor, global head of investment-grade syndicate at Wells Fargo, adds that firms are also preparing for a potential recession.

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