Creditflux launches inaugural survey of CSO market

By Dan Alderson

Creditflux is conducting a survey to gauge investor perceptions of the size of the synthetic bespoke tranche market so far this year, as well as the share of banks arranging deals.  

The private nature of CSO deals makes putting a number on their volume difficult, but dealers reckon these to have grown almost exponentially in recent years, from $20 billion globally in 2016 to $55 billion in 2017 and $80 billion last year. Expectations have been for a repeat of 2018 volume this year, but buy- and sell-side have noted long periods of low activity.

Getting a gauge of who tops the tables for CSO arranging is even less of a science, since banks have been ultra-cautious about disclosing these details. And buy-siders in the CSO market typically only know about the deals in which they have invested.

Creditflux will attempt to make an inroad into these uncharted territories by making available for the first time a measure of the size and composition of the synthetic bespoke market. We invite CSO investors to take part in our inaugural survey, with complete anonymity, and put numbers to the names for the first three quarters of 2019.

While we appreciate this is a tall order, we hope the overall response will serve as a useful guide to this burgeoning industry. We will aim to replicate the survey at the end of each quarter, mapping out the changing dynamics around issuance and arranging.

This comes as a new strand of the CSO market begins to open up, with some dealers having moved beyond the more familiar two- and three-year bespokes. Five-year CSOs are a feature this year, drawing in a different investor base and potentially reconfiguring the overall share of leading arrangers.

Our survey reflects this development and gives you, the investor, a chance to add your views on other initiatives that would benefit the market.

To take part in our survey, please click here.

Once again, answers will be treated as completely anonymous. Deadline for submissions is 5pm New York time Thursday next week (24 October). We will publish the findings of the survey in due course.


TAGS: Asia CDS Europe Structured credit Credit derivatives North America