Yet while the bond market was on the verge of locking up especially in the lower rating tiers, we observed that the leveraged loan market was still functioning because even as prices had slumped over the past two months, banks that committed to finance highly leveraged buyouts offered loans at substantial discounts to entice investors. And, as the chart below shows, the average new issue yield by month had risen to the highest in years, with CCC-rated issuers forced to pay the most in 7 years to round up investor demand.