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Risk spreads widened for London interbank offered rate-based U.S. commercial loan borrowers in June.
The average rate spread for a new Libor-linked commercial loan for a 5-rated borrower was 190 basis points in June, up 7 basis points since May but down 11 basis points since June 2018. Meanwhile, the average rate spread for a 12-rated borrower was 284 basis points, up 10 basis points month over month and 13 basis points year over year, according to data collected by S&P Global Market Intelligence on nonsyndicated commercial loan portfolios made by participating banks.
The 94-basis-point gap between spreads for a 5-rated and a 12-rated borrower was the largest in at least two years.
The average spread for a prime rate-linked commercial loan to a 5-rated borrower was 109 basis points in June, up from 105 in May, but down from 111 in June 2018. The average spread for a 12-rated prime borrower was 181 basis points in June, a 5-basis-point drop month over month and a 6-basis-point drop year over year.

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