With too much capital chasing too few deals, direct lenders, known for creativity in financing structures, are becoming even more creative to win business. Private credit firms that previously saw the syndicated market as their biggest competition are now facing off against each other, and with the abundance of dry powder in the private credit market, they are increasingly using PIK, portability and call protection to get an edge. “For some lenders in a loan coming up on a maturity, they can add a portability feature into a refinancing to keep the credit," said Dylan Brown, a partner at Goodwin. “It’s borrower and new-sponsor-favorable.” Until M&A recovers meaningfully, lenders will continue to rely on creative and flexible means to sign a deal and put their capital to work. “There’s a lot of pent-up demand and the floodgates will open once investors on the buy side and the lending side have certainty about what the regulatory and economic landscape looks like,” Goodwin’s Brown said. Read the Credit Insights article for more.