CLOs

  • PRA consults on CRR rules

    Market updates and sector developments

    The UK PRA has launched a consultation on draft rules to replace firm-facing requirements regarding securitisation under the CRR in 2H24. As such, it has published a discussion paper (DP) that raises certain key issues for feedback, in order to inform its approach - including the use of unfunded credit risk mitigation (CRM) in SRT transactions.

    In particular, the .......

    Market Moves 1 November 2023

  • Top-tech

    Private credit managers increasingly leveraging fintech

    Top-tier CLO and private credit managers are increasingly leveraging fintech support to facilitate proactive management through recent issuance spikes. Siepe, for one, cites technology as the key to optimising portfolios and enabling trading into better quality credits – having closed on a milestone US$1.2bn in BSL CLOs and an additional US$500m in private credit transactions in Q3.

    “By .......

    News 30 October 2023

  • Sculptor merger hit by litigation

    Market updates and sector developments

    Rithm Capital has responded to a complaint filed in the Delaware Court of Chancery by the Former EMD Group regarding the proposed merger between Rithm and Sculptor Capital Management (SCI 26 July). The group comprises the founding partners of Sculptor, including Daniel Och, Harold Kelly, Richard Lyon, James O’Connor and Zoltan Varga.

    The lawsuit asks the Court .......

    Market Moves 20 October 2023

  • Job swaps weekly: Octagon elevates Lam to ceo

    People moves and key promotions in securitisation

    This week’s round-up of securitisation-related job swaps sees Octagon Credit Investors appointing senior portfolio manager Gretchen Lam as its new ceo. Elsewhere, structured finance lawyers Martin Bartlam and Elana Hahn have joined Xfinite Global and Fasken respectively.

    The appointment of Lam as Octagon’s new ceo comes as the firm’s cofounder Andrew Gordon transitions into a new role as executive .......

    Market Moves 20 October 2023

  • US CLN market could reach US$220bn

    Market updates and sector developments

    JPMorgan securitised products research analysts estimate that the potential size of the US CLN market could amount to US$220bn, as banks become more comfortable with issuing the notes for capital relief purposes, following the Federal Reserve’s clarification of what defines a synthetic securitisation (SCI 29 September). Indeed, they suggest that the move may mark the beginning of a .......

    Market Moves 16 October 2023

  • Starting strong

    Leland Hart, portfolio manager and cio of performing credit...

    Q: Warwick Capital Partners closed its inaugural BSL CLO transaction – the US$400m Warwick Capital CLO 1 – last month. As a new entrant, how does Warwick’s strategy compare to that of existing managers in the market?
    A: It’s a pretty seminal time in the CLO market – when risk retention reared its head in the US and Europe and .......

    The Structured Credit Interview 16 October 2023

  • Wake-up call

    Collaboration needed for consistent CLO ESG practices

    Consistency across ESG reporting is the next crucial step for sustainability disclosures in the CLO market, as transitional climate risks exert pressure across the entire value chain. ELFA’s recent CLO Carbon and Sustainability Reporting Paper underscores the necessity for collaboration to determine common practices.

    Investor interest in ESG disclosures is surging throughout the structured finance industry (SCI .......

    News 11 October 2023

  • Rithm strengthens MSR capabilities

    Market updates and sector developments

    Rithm Capital has entered into a definitive agreement with Computershare to acquire Computershare Mortgage Services and certain affiliated companies, including Specialized Loan Servicing (SLS), for a purchase price of approximately US$720m. The acquisition includes approximately US$136bn in unpaid principal balance of mortgage servicing rights, of which US$85bn is third-party servicing, along with SLS’s origination services business. Following the close .......

    Market Moves 6 October 2023

  • Roll with the changes

    CLO rating upgrades on the cards

    CLOs may see more rating upgrades, despite current macroeconomic challenges, as more transactions reach their amortisation periods (see SCI CLO Markets). With defaults rising across the credit universe, actively managed CLO transactions are an outlier as the collateral remains stable.

    “Perhaps counterintuitively, we might see more CLO upgrades in the current environment,” stated Andrew South, S&P EMEA .......

    News 4 October 2023

  • RRAM acquires second slate of CLOs

    Market updates and sector developments

    Redding Ridge Asset Management has acquired CLO management contracts totalling US$2.8bn in AUM from Gulf Stream Asset Management. With the close of the transaction, Redding Ridge will have more than US$26bn of AUM and expects a seamless integration of the contracts and to actively manage the new portfolios consistent with its disciplined CLO strategy.

    Redding Ridge is an .......

    Market Moves 3 October 2023

  • Next level

    ESG back-reporting gaining traction

    ESG back-reporting may be the next step for sustainable disclosures as the battle to beat greenwashing continues. The GSEs are leading the back-reporting charge, with the introduction of Fannie Mae’s Social Index calculations and Freddie Mac’s historical data file release for all active and inactive MBS pools since 2010 (SCI 18 August 2022).

    “They are really driving .......

    News Analysis 29 September 2023

  • Wilmington bank adds CLO expertise

    Market updates and sector developments

    WSFS Financial Corporation’s global capital markets team is expanding into the CLO market, as it seeks to grow its wealth business and generate fee income on a national scale. To support this expansion, the company has recruited two new associates with expertise in CLOs.

    WSFS Global Capital Markets provides global services to the leveraged loan and capital markets, .......

    Market Moves 28 September 2023

  • BXCI to offer 'one-stop solution'

    Market updates and sector developments

    Blackstone has integrated its market-leading corporate credit, asset-based finance and insurance groups into a single new unit, named Blackstone Credit & Insurance (BXCI). Credit and insurance is Blackstone’s fastest-growing segment – more than doubling to US$295bn in assets under management over the last three years.

    The new structure is designed to further accelerate growth by creating a more .......

    Market Moves 15 September 2023

  • Lift-off

    CLO issuance takes flight in active summer

    CLO volumes in both the primary and secondary markets have accelerated in the third quarter so far, particularly in the US, after a slow first half of the year. But a sluggish syndicated loan market, dominated by a glut of refinancings and amend and extend deals, mean the flurry of activity could settle somewhat in the months ahead.

    News Analysis 15 September 2023

  • RFC issued on CLO good practices

    Market updates and sector developments

    IOSCO has called for an improvement in practices in the leveraged loan market and is seeking feedback on a number of good practices it is proposing in connection with CLOs. The organisation notes that a “prolonged borrower-friendly environment” has impacted market practices, giving rise to covenant-lite leveraged loans, increased complexity of documentation and the aggressive use of EBITDA adjustments.  

    Market Moves 14 September 2023

  • Pressure on UK BTL loans in RMBS portfolios

    Market updates and sector developments

    The UK buy-to-let mortgage market is likely to see an increase in arrears, a reduction in origination volumes and higher rates of home repossessions in the months ahead. Analysis of RMBS portfolios by DBRS Morningstar highlighted headwinds in the form of tenant affordability, stricter regulations and changes in taxation that are likely to put pressure on BTL landlords.

    Market Moves 11 September 2023

  • CLO saviour?

    Collateral managers act to save two CLOs in Q2

    In Q2, two of the 85-90 CLOs rated by DBRS saw old, underperforming loans replaced with new money by the collateral managers before the reinvestment period closed, report analysts at the rating agency.

    This was the first time the phenomenon had been spotted in recent times. Both were commercial real estate (CRE) transactions, backed by office space loans, but no other details .......

    News Analysis 6 September 2023

  • GLAS strengthens European footprint

    Market updates and sector developments

    GLAS SAS is set to acquire Paris-based asset management and trust business Pristine, subject to regulatory approval and customary closing conditions. This is GLAS’s first acquisition as it seeks to strengthen its European footprint and fast-track global expansion.

    Established in 2016, Pristine provides fund structuring and management services to both international and domestic institutions with the primary purpose .......

    Market Moves 1 September 2023

  • Securitisation exempt from private fund rule

    Market updates and sector developments

    The US SEC has determined that securitised assets funds, including CLOs, are exempt from its Private Fund Advisers Rule. The new rules aim to protect private fund investors by increasing transparency, competition and efficiency in the private funds market. To enhance transparency, the rules will require private fund advisers registered with the Commission to provide investors with quarterly statements - .......

    Market Moves 25 August 2023

  • Job swaps weekly: TCW snaps up American Century securitisation head

    People moves and key promotions in securitisation

    This week’s roundup of securitisation job swaps sees TCW Group appoint a successor to its recently departed global co-head of securitised products. Elsewhere, ARC Ratings has hired a European industry veteran as non-executive director, while Guy Carpenter has appointed a senior marketing and business development executive as md. 

    Los Angeles-headquartered asset manager TCW has appointed American Century Investments’ Peter Van Gelderen as .......

    Market Moves 18 August 2023

  • Fine-tuning UK securitisation

    FCA and PRA take pragmatic approach to post-Brexit regulations

    The FCA’s consultation on UK securitisation regulations suggests there will be some welcome changes to retained regulations ‘onshored’ post-Brexit. But the British government is unlikely to secure the bonfire of regulations it set out to achieve.

    The FCA published its plans last week (SCI 7 August), two weeks after the PRA released its consultation and less than a .......

    News Analysis 15 August 2023
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