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The markets are supporting high reset and refi volumes —but sometimes calls are a better option
14 days ago
Broadly syndicated loans and CLOs kicked off 2024 with a nice rally. As a result, we are seeing a resurgence of majority CLO equity holders exercising their rights to refinance, reset, or even call their CLOs. -
Basel III looks likely to further increase banks investment in CLO triple As
5 months ago
Demand for CLO triple As has grown substantially over the past few years as more banking institutions, pension funds, asset managers and insurance companies discover this attractive asset class, which historically has never taken a loss. -
Borrowers are finding creative ways to address loan maturities
8 months ago
Amend and extends have been the loan market’s flavour of the year. At the same time, many CLO reinvestment periods are reaching their end because the reset market is virtually closed. -
For the vast majority of managers, CLO AUM is akin to a melting ice cube
9 months ago
The past two years saw some of the largest ever CLO collateral manager acquisitions. We don’t expect this to ultimately lower the number of CLO collateral managers active in the market — each year brings new entrants — but it does create complications for investors in CLOs issued by both the acquired and the acquirer. -
" CLOs do not introduce more credit risk, nor do they offer less liquidity, than comparable products"
11 months ago
The pressure facing some banks is self-inflicted. Their portfolios lack exposure to CLOs -
"Some CLO managers are asleep at the wheel and surrendering economics without any objection"
1 year ago
Some CLO managers aren’t blocking loan amendments with insufficient credit spread adjustments -
"With tools and data available, why do fake sellers need to abuse the b-wic process for price discovery?"
1 year ago
Penalties for CLO b-wic sellers who routinely do not trade would improve the secondary CLO market -
"CLOs could withstand another 13.4% of downgrades to triple C if the price drops to 50"
1 year ago
CLOs are well positioned, even if there are mass downgrades to triple C -
"There is ample time and flexibility on the pathway from warehouse to securitisation"
1 year ago
A big loan sell-off does not mean CLO warehouses will be forced to liquidate -
"The equity IRRs of enhanced CLOs are nearly all in the bottom decile of the market"
High triple C CLOs sound like a good idea on paper. But in practice, they have not fared well1 year ago -
"The CLO that started the wave of prints and sprints paid near 20bp more than the market average"
1 year ago
It is possible to hit a home run with a print and sprint CLO, but execution is difficult -
CSAM does the CLO awards double
1 year ago
Winning the Creditflux Manager of the Year award is a feat in itself. Winning it back-to-back in such different markets is an outstanding achievement — and CSAM can take great pride in it -
"The CLO market can resemble a primary school soccer game, with everyone crowded around the ball"
1 year ago
The ability to refinance or reset a CLO is valuable, but there are friction costs to consider -
"Having tighter CLO debt costs will not be enough for brand names to outperform more agile competitors"
1 year ago
The drop in loan and CLO prices today is unlike any previous downturn — but again it will pay to be agile -
"The reset market is open, but it doesn’t always make sense to extend the life of a CLO"
2 years ago
Strong secondary loan prices are making CLO liquidations a compelling option -
"This is the CLO market’s time to shine and prove it deserves to be a mainstream asset class"
2 years ago
The CLO market shouldn’t fear inflation — in fact, 2022 could be a very good year indeed -
"We again have to flag up information in CLO marketing pitches that can mislead investors"
2 years ago
Cash-on-cash returns, default records and leverage statistics don’t always give CLO investors the full picture -
"CLO equity investors have long accepted basis risk… but an off-market adjustment does not work"
The 26bp adjustment is disrupting the transition away from Libor — but market forces will prevail -
The Creditflux CLO Symposium was back as an in-person event for the first time in two years and participants were delighted to socialise and bask in an amazing year for the credit industry2 years ago
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"Purchasing IG CLO debt was a key driver of success for 1.0 CLOs"
2 years ago
Longer reinvestment periods, the ability to buy IG tranches and improved loan settlements would improve CLOs -
"If you sat still on a large portfolio of 2019 and 2020 CLOs, it may have shrunk by more than 25%"
With the majority of this year’s CLO deals being refis and resets, investors have had to run to stay invested2 years ago -
"In some ways, CLOs resemble a quirky, cottage industry more than a trillion-dollar market"
2 years ago
CLO volumes outstanding have passed $1 trillion, but index omission and private placements are holding us back -
"Spacs… what better buyer than someone with a short fuse who needs to get their capital working"
2 years ago
Since the beginning of 2020, more than $191 billion has been raised in spac (special purpose acquisition company) IPOs. This money has such a short fuse — get a deal done in 24 months or management loses the IPO costs it covered — and there has been so much of it, that it has had an impact on the markets -
"How CLO managers optimise the value of reorg equity is one of the most important unasked questions"
2 years ago
Getting the most out of reorg equity could be the difference between a good CLO and a great one -
"Why can’t loans and CLOs simply move to three-month treasury bills as our reference rate?"
2 years ago
Sofr may be touted as Libor’s natural replacement, but the best known rate in the world is also an option
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