Data Breaches and the Private Credit Market: Post-Breach Considerations

In the private debt market, it is important for lenders to consider the impacts of increasingly sophisticated and financially impactful data breaches. A primary concern for lenders is that a borrower will expend capital addressing such liabilities that could otherwise be used to service their debt and/or to grow the enterprise, potentially resulting in financial defaults. In this two-part guest article series, Proskauer partners Ryan P. Blaney, Bharat Moudgil and Evan Palenschat discuss considerations to prevent and mitigate the effects of a borrower’s cyber incident. Part one discussed the cost of breaches, why vigilance is urgent and proactive steps to take to assess a borrower’s preparedness. This second part covers how to prepare for and address a borrower’s breach. See “Privacy and Security Due Diligence in M&A Transactions: Going Beyond the Questionnaire” (Jan. 19, 2021).

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