Since Bernanke’s comments, junk bonds have lost 2.8 percent to trim gains this year through June 11 to 2.8 percent, according to the Bloomberg USD High Yield Corporate Bond Index. Second-lien loans gave up 0.3 percent in the same period, Barclays data show.

“This is a way of getting outperformance on the index if default rates are low,” Bell said. “If people were worried about the world, second-liens would have a tougher time.”

‘Best Terms’

The junior loan borrowings fit in between first-lien loans and bonds in a company’s capital structure. Issuers may have restrictions in their credit agreements limiting senior ranking debt and in such cases a second-lien loan may be an option, according to David Breazzano, president of DDJ Capital Management LLC, which manages more than $6 billion in below investment-grade assets.

“Companies want to take advantage of where they can get the best terms for financing,” he said in a telephone interview from Waltham, Massachusetts. “There are cases where a company looks to split its offerings into multiple tranches to get a better rate on the overall deal.”

First-lien investors may demand an interest premium to lend to a borrower whose leverage, or the ratio of debt to earnings before interest, taxes, depreciation and amortization is too high, according to Breazzano. An issuer can work around that by reducing the size of the senior loan and pay a higher rate on a smaller second-lien piece, which may end up offering a better overall rate, he said.

Atkins Loan

Atkins Nutritionals borrowed $355 million in the form of a $100 million second-lien loan that paid interest at 8.5 percent more than Libor with a 1.25 percent minimum on the lending benchmark and a $255 million senior loan that paid 5 percent more than benchmark with a similar floor, Bloomberg data show.

Rite Aid lowered the rate on a $500 million second-lien loan it’s seeking to tender for second-lien notes, according to a person with knowledge of the transaction.

The debt, due in eight years, will pay interest at 3.88 percentage points more than the Libor, down from 4.25 percentage points initially proposed, said the person, who asked not to be identified because terms are private. The lending benchmark will have a 1 percent minimum.