Moody's makes new CLO upgrades

Moody’s upgraded five CLOs yesterday, taking its tally of upgrades in the past week to 11, providing growing evidence of its willingness to raise the ratings of well performing deals (see Moody’s rating actions signal change of direction).

Yesterday, the agency upgraded tranches from Prudential Investment Management’s Dryden XVIIII, Halcyon Loan Investors CLO II (managed by Halcyon Asset Management), BlueMountain CLO II, and Callidus Debt Partners CLO Fund VII (now managed by GSO Capital). Moody’s also upgraded a static CLO known as SFR. It said all the upgrades were in response to improvements in the deals' credit quality.

Moody’s recent CLO rating actions buck the trend of downgrades by all three rating agencies in the past year. Standard & Poor’s, for example, continues to mark down CLOs, downgrading a batch of European deals on Friday.