Investment banking

How leveraged finance can unlock new opportunities for growth Institutional investors could provide the capital you need to achieve your goals.

At some point in your company’s journey, you may grow too large or too fast for traditional lending options. For transactions from the hundreds of millions to the billions, leveraged financing allows companies to drive continued growth by accessing capital from institutional investors. That capital can help fund a variety of initiatives, including organic growth, refinancings, or mergers and acquisitions.

“The institutional markets can provide a deeper pool of capital that can help companies sustain their momentum,” says Chris White, head of Leveraged Finance and Syndicate at Truist Securities.

Transcript

Audio description: Light music begins.

Visual description: The Truist logo appears in the center of the screen in front of a purple background, then fades to reveal Chris White being interviewed in a modern office setting.

On-screen text: Chris White, Head of Leveraged Finance and Syndicate, Truist Securities.

Chris White: At a certain point, traditional lending just can’t keep up with the speed or scale of your growth. And that’s where leveraged finance comes in, not just as another funding option but as a driver for momentum.

Visual description: Scene changes to reveal Chris seated on an office sofa and conversing with two women and a man dressed in business attire.

Audio description: Light music continues.

On-screen text: Leveraged finance to drive continued growth.

Visual description: The camera cuts to a close-up of Chris as he reacts to the conversation and then reveals the group of four seated on the sofa.

Chris: Access to institutional investors and the term loan B and high-yield markets provide flexible solutions to help set up your business for future success.

Visual description: Chris is being interviewed in a modern office setting.

Chris: Whether that be funding a large-scale expansion, acquisitions, or recapitalizations, the leveraged finance investor base provides a deep pool of capital that you can access now and in the future to help drive growth in your business.

Visual description: Scene changes to reveal Chris conversing with the three businesspeople on the office sofa. The camera then cuts back to Chris in the interview setting.

Chris: We begin by listening and not pitching to understand your business model, growth goals, asset mix, and risk tolerance. This allows us to tailor the right capital structure that aligns with your strategy and facilitates growth.

Visual description: The scene changes to reveal Chris seated at a conference room table, meeting with several colleagues and clients.

Chris: The markets have evolved.

Visual description: Chris is being interviewed in a modern office setting.

Chris: Leveraged finance structures have become much more flexible, more creative, and better aligned with long-term value creation for issuers. Whether you’re doing asset-based lending, covenant-lite term loan B’s, or high-yield securities, terms across the various asset classes provide issuers with operating freedom.

Visual description: Scene changes to reveal Chris conversing with the three businesspeople on the office sofa.

Chris: Our role is to tailor those instruments to your needs and to make sure that they align with your broader strategy.

Visual description: Chris is being interviewed in a modern office setting.

Chris: Staying close to the full lifecycle is core to what we do in providing you guidance, expertise, and support now and for all your future capital structure needs. Leveraged finance isn’t a one-time transaction. When it’s done right, it becomes part of a larger strategy. And we go beyond the expected to make sure it’s one that will power your company’s momentum.

Visual description: Scene fades to reveal the Truist Securities logo and title in the center of the screen on a purple background.

On-screen text: Truist Securities. Going beyond the expected. Copyright 2025 Truist Financial Corporation. Truist and Truist Securities are service marks of Truist Financial Corporation. All rights reserved. Truist Securities is the trade name for the corporate and investment banking services of Truist Financial Corporation and its subsidiaries. Securities and strategic advisory services are provided by Truist Securities, Inc., member FINRA and SIPC. Lending, financial risk management, and treasury management and payment services are offered by Truist Bank. Deposit products are offered by Truist Bank, Member FDIC.

Audio description: Light music ends.

Types of leveraged finance transactions

Many leveraged finance deals fall into one of two categories—term loan B’s or high-yield bonds. Term loan B’s are typically secured loans with a floating interest rate. High-yield bonds can be secured or unsecured with a fixed rate. The lack of security on unsecured bonds typically means interest rates for high-yield bonds are higher than those of term loan B’s. And, in general, the rates for both of these types of leveraged finance transactions are often higher than the rates of traditional bank loans.

“When you go to the institutional market, it tends to be a little more expensive, especially in the high-yield market, but that’s the trade-off,” White notes. “What you’re getting in return is that deep pool of capital—beyond what a bank can provide—to fund your future growth. And if you can show debt investors you can perform, you can go back to them to get future financing very efficiently.”

You’re also maintaining equity when you pursue a leveraged finance transaction. “Many companies don’t like to use their equity unless they have to for something very strategic, and the leveraged finance market, or the debt products in particular, provide them a way to preserve their equity.”

A future-focused approach

White says choosing a leveraged finance transaction starts with having a strong vision for your capital needs and structure, something Truist Securities works closely with clients to understand.

“We always start with ‘Where do you want to go?’” says White. “Answering that question requires a CEO and a CFO to look five or 10 years down the road. Their business may be growing at a rapid enough pace that they think they’re going to be two or three times the size they are now within a decade. Or they may have an acquisition target in mind that would double their size.”

We’re always thinking about the long-term strategy that will help set our clients up for success.
— Chris White, Head of Leveraged Finance and Syndicate, Truist Securities

As company leaders weigh the cost of capital against the opportunities it can provide, White says it’s important to remember that the first capital raise in the institutional market is typically the most expensive.

“Cost of capital is inverted,” he explains. “If you do what you say you’re going to do for these debt investors, then the next time you come back, the cost of capital will likely decrease. Then two years down the line when that acquisition target you’ve had on your radar pops up, you’ll already have access to deep pools of capital to fund that acquisition.”

The other advantage of long-term thinking is that by planning ahead, you’re less susceptible to market changes, such as rising interest rates. This is especially true when refinancing capital. With a long-term strategy, you can refinance at a time that works well in a rate environment that’s favorable, rather than potentially being stuck refinancing at an unfavorable rate.

A depth of resources and connections

White says choosing the optimal time for your capital markets transaction is one way Truist Securities’ approach of bringing in a full team works to clients’ advantage. His team is in regular contact with industry and macroeconomic specialists who can advise on a wide range of indicators: from industry trends that could present new opportunities for clients to what the Federal Reserve may be thinking about interest rates.

Truist Securities teams can also provide insight into the institutional investor audience through their years of experience. White says there are important differences to understand when companies are preparing to present to institutional investors. An equity investor may be most concerned with growth, which can increase stock price. Debt investors, however, want to be assured they’ll be repaid with interest—which means they’ll focus on performance and cash flow when deciding whether to invest capital in a deal.

“We have decades-long relationships with these investors and portfolio managers, so when a client is getting ready to pursue a transaction for the first time, we’re going to help set them up for success by making sure they understand the metrics each specific investment firm will be looking at,” says White.

It’s always important for companies to keep an open mind about whether a leveraged finance transaction is the right one to pursue. White says leveraged finance is not for everyone. Truist Securities always starts with the company’s needs and goals before considering what type of transaction is the best fit.

When leveraged finance is the right move, White says the results speak for themselves. “With most of our clients, we partner over a long-term horizon where we’re not just doing one deal, we’re looking to do multiple transactions over the life of the relationship,” says White. “And we’re always thinking about the long-term strategy that will help set our clients up for success. You really see the benefits of that when a client needs to build a manufacturing plant or acquire a company, and their capital structure is already set up to make that possible.”

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Investment banking

Investment banking

Types of leveraged finance transactions

A future-focused approach