Portfolio manager exits US CLO firm

By Mike Peterson

Friday, September 07, 2012

A New York-based CLO manager has parted company with its longstanding head

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TAGS: High yield bonds People Leveraged loans

Comment by: Anonymous. Posted 11 years ago [2012-09-08 18:02:04]

Provocative question below. My answer is that CLO managers do have an incentive contrary to the interests of the debt investors (especially the triple-A). So I would put my triple-A money only with the manager who will show a track record of acting for investors (e.g., by not bending reinvestment rules contrary to document intent) and a desire to continue to do so. More broadly, CLOs and CDOs are unique and troublesome in that the various investors are not all equal with respect to manager conflicts.

Comment by: Anonymous. Posted 11 years ago [2012-09-07 12:59:01]

Debt firm parts company with head of CLO business. On its own not a lead item, but when considered in the context of PE ownership, a very familiar theme. As a CLO investor, if you value who is looking after your money, you should be asking this question: does it make any sense to park it anywhere remotely close to the private equity business model? Discuss

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