Possible scenario
Stress stays contained
35% Chance
Distressed loan balances remain elevated, but lenders, CLO managers and private credit funds avoid a disorderly wave of defaults. Borrowers use amend-and-extend deals, asset sales and sponsor equity injections to push maturities beyond 2027.
Initial impacts
- Riskier companies' borrowing costs Down
- Market volatility Down
- 10-year Treasury yield Up
Secondary impacts
- Finance +0.6%
- Consumer Cyclicals +0.5%
- Business Services +0.3%
Portfolio impact
S&P 500+0.5%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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