CLOs

  • Taurus investment increased

    Chenavari fund Toro recently disclosed that it has increased its investment in an originator - Guernsey LLP Taurus Corporate Financing - in relation to its originated transactions strategy, via two investments of €23m and €12m in loan warehouse transactions. Taurus will act as the originator for and hold risk-retention securities in Chenavari Investment Managers' latest CLO - the €350m Toro .......

    News Round-up 15 August 2016

  • Mixed quarter for Euro CLOs

    The European CLO market came to a brief halt at the end of June, notes S&P in its 2Q16 European CLO performance index report, as investors absorbed the uncertainty created by the result of the UK's referendum on EU membership. Issuance still managed to climb year-on-year, however.

    The second quarter saw market pricing tighten from 150bp to 128bp, and it .......

    News Round-up 11 August 2016

  • Post-crisis Greek CLO emerges

    National Bank of Greece (NBG) has completed the first Greek SME securitisation since 2007. The transaction, Sinepia, will enable the bank to raise up to €300m of medium-term financing.

    The senior tranches of the CLO were placed with the European Investment Bank, European Investment Fund and European Bank for Reconstructions and Development (EBRD). The senior notes - rated double-B by S&P .......

    News Round-up 9 August 2016

  • Retail risks weighed

    Exposure to the retail sector poses idiosyncratic risk to US CLO performance rather than widespread challenges, according Fitch. The inclusion of loans from challenged retailers like J Crew and Tailored Brands (Men's Wearhouse) in portfolios remains a concern (SCI 9 June), but is not expected to significantly impact CLO performance.

    Retail is the third largest sector in Fitch's CLO database, .......

    News Round-up 9 August 2016

  • Japan stimulus to boost SMEs

    A new ¥28trn stimulus package introduced by the Japanese government is credit positive for SME structured finance deals, says Moody's in its latest Credit Outlook. The package includes measures to help ease SME refinancing and provide them with greater flexibility for borrowing.

    According to Moody's, diversification and funding alternatives will help a variety of SME deals, including CLOs and ABS .......

    News Round-up 8 August 2016

  • Direct lending team acquired

    A partnership managed by CVC Credit Partners, supported by a fund advised by Coller Capital, has acquired Northport Capital TRS from Resource Capital Corp. The move will increase assets under management in CVC Credit Partners' global direct lending strategy to approximately US$1bn and complement its existing European strategy.

    Northport is a direct lender that specialises in providing credit facilities to .......

    Job Swaps 8 August 2016

  • US CLOs still strong

    The US CLO secondary market is still maintaining the strong activity levels seen since the Brexit vote back in late June.

    "The market is very strong, with this continuing to centre on mezzanine where a real curve is developing," says one trader. "Sellers saw the strong execution in BWICs early in the summer and have found little reason to stop .......

    SCIWire 4 August 2016

  • SME CLO leverage worsens

    SME leverage has worsened since 2011, which is a credit negative for SME CLOs, says Moody's. The median total leverage for the 750 Moody's-rated US SME obligors in CLOs has increased to 4.6x in 2015 from 4.0x in 2011, leading to a deterioration in SME borrower credit quality.

    Although leverage increased only slightly among the 124 unique SME obligors in CLOs .......

    News Round-up 3 August 2016

  • CLO refinancing scenario RFC issued

    Moody's has previously outlined proposed changes to how it examines refinancing scenarios in its rating analysis of combination securities secured by CLO or CDO debt tranches (SCI 22 April). In a supplemental request for comment, the agency now seeks feedback on how it will examine refinancing scenarios in the rating analysis of combination securities.

    For CLOs evaluated any time between closing and .......

    News Round-up 2 August 2016

  • US CLOs stay robust

    The US CLO secondary market is maintaining robust activity levels so far this week after a strong July.

    "It was actually the busiest month we have had for a long time, not just in CLOs but across a number of our fixed income desks," says one trader. "It may be surprising to some, but there were a variety of factors .......

    SCIWire 2 August 2016

  • Better loan prices soften CLO blow

    Improving oil and gas loan prices last quarter helped to mitigate the impact from default and triple-C haircuts in US CLOs with exposure to the sector, according to Fitch's latest US CLO index. Average senior OC ratio and par gain declined at a slower pace than in the previous quarter, while exposure to defaulted issuers decreased from 1.1% of the .......

    News Round-up 2 August 2016

  • CLO pay-downs surge

    The number of CLO pay-downs in JPMorgan's CLO index (CLOIE) since the June rebalance through 31 July was US$6.79bn in par outstanding, up dramatically from US$1.45bn the previous month. This was split between US$2.05bn and US$4.74bn of pre-crisis and post-crisis CLOs respectively.

    The post-crisis CLOIE added US$4.4bn with 61 tranches across 11 deals at the June rebalance. Meanwhile, all CLOIE .......

    News Round-up 2 August 2016

  • Global development head hired

    Tetragon subsidiary, LCM Asset Management, has brought in Chris D'Auria to run its global business development efforts. The firm says it will look to utilise his skills to expand its global outreach and tackle the changing regulatory landscape in CLOs.

    D'Auria joins from Deutsche Bank, where he was md and co-head of the bank's global CLO business. His experience has seen .......

    Job Swaps 2 August 2016

  • Tightest CLO for nearly a year

    Babson Capital has brought its latest US CLO to the market, with the senior tranche pricing at the tightest spreads seen since September last year. Babson CLO 2016-II's class A notes were registered at 145bp last Friday, coinciding with the ongoing rally in the market.

    "Babson is a fairly sought after name in the market," says one US-based trader. "So in .......

    News 2 August 2016

  • Leveraged finance team recruited

    Allen & Overy has hired a team of five New York-based leveraged finance partners. The team is led by Scott Zemser and includes Alan Rockwell, Rajani Gupta, Judah Frogel and Todd Koretzky.

    Zemser, Rockwell and Frogel join from White & Case, while Gupta and Koretzky arrive from Milbank, Tweed, Hadley & McCloy. The team will assist both domestically and internationally in .......

    Job Swaps 1 August 2016

  • CLO rating upgrades continue

    US CLO rating movements held steady in 2Q16 despite default pressures, according to S&P. Upgrades dominated the rating action count, with a total of 141 across 29 transactions.

    The agency says that liability pay-downs continued for 1.0 deals and some of the earlier 2.0s. 67 ratings were raised across 25 reinvesting CLOs as these deals saw below-average deterioration in credit .......

    News Round-up 1 August 2016

  • US CLO rally continues

    The US CLO secondary market is continuing a strong week with buyers still pouring money into the space.

    "The focus continued to be in mezzanine and equity yesterday and it looks like it will be the same today," says one trader. "I think a lot of it is hedge fund money trying to tap into the liquidity as the rally .......

    SCIWire 28 July 2016

  • Leveraged finance heads appointed

    Goldman Sachs has appointed Dominic Ashcroft and Luke Gilliam as co-heads of leveraged finance capital markets in EMEA. Both were previously mds in the bank's leveraged capital markets team and are based in London.

    .......

    Job Swaps 28 July 2016

  • CLO trading flexibility 'reducing'

    US CLO 2.0s are losing trading flexibility because of leveraged loan quality deterioration and diminished spreads, says Moody's. Managers are struggling to maintain compliance with collateral quality tests while sourcing eligible collateral investments.

    Of the 613 US CLO 2.0s Moody's rates that were still reinvesting as of 1 June, 20 were failing either their WARF or WAS tests. Another 35 .......

    News 28 July 2016

  • Collateral management changes made

    A trio of CLOs have amended their collateral management agreements following on from NewStar Capital's acquisition of Feingold O'Keeffe Capital last year (SCI 17 September 2015). The affected CLOs are Avery Street CLO, Emerson Place CLO and Lime Street CLO.

    In each case: the cause event relating to the departure of NewStar's key personnel has been revised to add a .......

    News Round-up 28 July 2016

  • Euro CLOs switch

    Activity in the European CLO secondary market has switched from sporadic to fluid this week.

    "The market has become a lot more fluid over the past week or so," says one trader. "With that has come continued tightening across the capital structure in both 2.0s and 1.0s."

    The trader continues: "We've seen good two-way flows across the board. There's not .......

    SCIWire 28 July 2016
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