CLOs

  • US CLOs ebb and flow

    The mezz rally in the US CLO secondary market halted last week and that part of the capital structure looks set to drift this week as equity paper takes up the slack.

    "It feels like we're in sideways mode today," says one trader. "Secondary volume is lighter across the board this week than it was last week when the mezz .......

    SCIWire 10 May 2016

  • Low-rated CLO risks downplayed

    Compared to the overall European high yield universe, a relatively small number of low rated CLOs exhibit early warning signs of potential defaults, says Moody's. In total, 23 (58%) of the 40 European CLO-held assets that Moody's has rated B3 or lower show early warning signs of potential default, while 76 (67%) of the 113 such issuers in the overall .......

    News Round-up 10 May 2016

  • Insurers' structured holdings slip

    Life insurers held more than US$380bn of structured products securities at the end of 2015, which Wells Fargo analysts note represents a decline of approximately US$20bn from year-end 2014. Insurers' balance sheets actually increased 2%, so the decreased allocation to structured products is even greater on a relative basis.

    As a percentage of total cash and fixed income, structured products' .......

    News 10 May 2016

  • Manager replacement in the balance

    The trustee for the Strawinsky I CLO has received notice from a class B noteholder disapproving the appointment of Dynamic Credit Partners Europe as successor investment manager (SCI 22 April). Pursuant to clause 10.5 of the master investment manager terms, the appointment of a replacement manager is subject to a simple majority of the controlling class (currently the class B .......

    Job Swaps 9 May 2016

  • Post-crisis CLO returns keep momentum

    The total amount of CLOs that paid down in JPMorgan's CLO Index (CLOIE) in April was US$3.54bn in par outstanding, split between US$2.92bn of pre-crisis CLOs and a further US$620m in post-crisis deals. The post-crisis index added an additional US$2.2bn at the April rebalance, spread across 30 tranches and six deals.

    The return on the CLOIE Total Index stood at .......

    News Round-up 5 May 2016

  • BlackRock names CLO head

    Josh Tarnow is taking over as head of BlackRock's CLO and bank loans business. This comes after Leland Hart's decision to step down from these roles to pursue other interests.

    A structural reorganisation within BlackRock's bank loans team in the US back in March 2015 saw it place Scott Snell and Adrian Marshall in charge of the day-to- day responsibilities .......

    Job Swaps 5 May 2016

  • Brexit risk to Euro CLO performance

    The European CLO market has seen €4.44bn in new issuance this year, slightly above the €4.39bn up to the same point in 2015, despite volatility in the secondary loan and wider financial markets earlier in the year, notes S&P. It is also despite the potential for further volatility due to geopolitical events such as the Brexit vote.

    CLO managers have .......

    News Round-up 5 May 2016

  • CLO 2.0 'more resilient'

    Post-crisis European CLO triple-A ratings would avoid downgrades even if faced with stresses similar to those experienced during the height of the financial crisis, says Fitch. This is due to greater credit enhancement and improved portfolio homogeneity.

    An analysis of Fitch-rated pre-crisis CLOs with similar collateral profiles to the new generation of transactions - including 190 tranches outstanding in 2007 .......

    News Round-up 4 May 2016

  • Euro CLO equity returns impress

    Overall European CLO equity returns have largely been as expected, according to a study by data and cashflow analytics firm Codean. Despite the global financial crisis, European CLO equity from the 2006 and 2007 vintages successfully "achieved what it said on the tin".

    Although all deals are sold on the assumption that investors will make solid returns, not all deals .......

    News Round-up 3 May 2016

  • US mid-market mix emerging

    Moody's expects the US mid-market loan sector to increase in variety if the upcoming 2016 to 2020 maturity wave coincides with an economic downturn. The agency expects CLOs, private equity firms, hedge funds and banks to play a larger role in the financing of mid-market companies.

    Non-banks have driven the majority of mid-market lending growth since 2007. They accounted for .......

    News Round-up 29 April 2016

  • Expanding manager debuts Euro deal

    BlueMountain Capital Management has closed its first European CLO with €410m in commitments, while it also continues to build out its European team. The firm closed four CLOs in the US last year.

    BlueMountain appointed Nick Pappas as European ceo last year (SCI 16 April 2015) and says it has a strong commitment to building its European presence. It hired .......

    Job Swaps 29 April 2016

  • Middle ground

    Issuance, investors challenging CLO mid-market

    Issuance within the US CLO market has dampened so far in 2016 as the sector suffers from the reverberations of wider credit market volatility. The CLO mid-market has not been exempt, but many of its issues remain tied to its small investor base.

    The sluggish start to the year has seen just US$9.9bn in US CLOs issued to date, according .......

    News 29 April 2016

  • European placements trending down

    Only €14.3bn of securitised product was placed in Europe in 1Q16, according to AFME's latest data snapshot on the market, as €42.5bn was retained.

    A total of €56.9bn was issued last quarter, a decrease of 20.3% from the €71.4bn issued in 4Q15. However, it was significantly up from the €35.3bn issued the same time last year - a 61.2% increase on 1Q15.

    News Round-up 28 April 2016

  • Euro secondary picks up

    The European securitisation secondary market saw an increase in activity yesterday to go with the improving tone of recent sessions.

    "After being quiet for the past few days flows picked up across the board yesterday," says one trader. "Volumes are still not huge, but we're now seeing a lot of enquiries from investors looking for paper."

    Notably, the trader adds: "That .......

    SCIWire 27 April 2016

  • US CLOs strengthen

    Tone and activity in the US CLO secondary market continues to strengthen.

    "The background remains positive with oil above 40, stocks hitting new highs and people happier with credit in general," says one trader. "For our part, we're seeing a bid for equity, mezz continues to rally and new issue activity is starting up again, so the CLO picture is .......

    SCIWire 26 April 2016

  • Liquidity tops investor concerns

    While investor fears over China-related uncertainty have subsided, concerns regarding liquidity and central bank policies have grown, according to Morgan Stanley's latest global securitised products investor quarterly survey. Liquidity is the top concern for 21% of respondents.

    Central bank policies cause the most concern for 18% of investors while disappointing US economic growth is now the third greatest concern, at .......

    News 26 April 2016

  • CLO cashflow diversion eyed

    Silver Spring CLO recently became the first post-crisis US CLO to experience full cashflow diversion from the equity. The 2014-vintage Silvermine Capital deal has a triple-C exposure of 15.6% and a 5% triple-C covenant, which is lower than the average 7.5% covenant in most post-crisis CLOs, according to JPMorgan CLO analysts.

    Silver Spring CLO's exposure to energy and mining loans .......

    News 26 April 2016

  • CLO services co-leads named

    Hillel Caplan and Lynda Lazzari have been named co-leads for Deloitte & Touche's CLO services practice within the firm's securitisation practice.

    A Deloitte Advisory partner, Caplan has more than 22 years of experience serving asset management and banking clients. Based in the firm's New York office, his new CLO services practice co-leadership role will focus on financial technology offerings to .......

    Job Swaps 26 April 2016

  • Euro secondary steady

    The European securitisation secondary market continues to move steadily ahead.

    Tone continued to be positive across the board at the end of last week and into the start of this. However, lack of supply is still an issue and is causing sessions to be steady rather than spectacular.

    Nevertheless, many of the line items in for the bid are continuing .......

    SCIWire 26 April 2016

  • Manager replacement resolved?

    Pursuant to a written resolution, the subordinated noteholders of Strawinsky I CLO have resolved to direct the trustee to appoint Dynamic Credit Partners Europe as successor investment manager, subject to controlling class (currently the class B noteholders) approval. IMC Asset Management tendered its resignation as investment manager for the second time on 15 April, having initially tendered its resignation on .......

    Job Swaps 22 April 2016

  • APAC solutions unit formed

    Natixis has appointed Fabrice Guesde as head of global structured credit & solutions (GSCS), Asia Pacific, to lead the newly-created unit. Based in Hong Kong, he reports to GSCS global head Emmanuel Lefort and locally to APAC fixed income head Viet-Linh Ha Thuc.

    Guesde has been with Natixis since 2006, latterly in Paris as head of credit & insurance solutions. .......

    Job Swaps 22 April 2016
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