CLOs

  • Mezz CLO fund launched

    AXA Investment Managers has launched a short maturity CLO opportunity fund. The fund aims to offer investors a net total return of 4% to 6% by investing in the vintage US CLO mezzanine universe, while maintaining an investment grade average rating.

    Christophe Fritsch, co-head of securitised and structured assets and head of structuring at AXA IM, says: "The fund was .......

    News Round-up 16 March 2015

  • US CLO demand continues

    The US CLO secondary market rally is continuing and so is investor demand.

    "Bid lists are still trading well and we've seen some bonds trading at pretty steamy levels," says one trader. "Double-As have come in the most in percentage terms, but people are still fighting for paper further down the capital stack."

    The trader sees no sign of demand .......

    SCIWire 13 March 2015

  • SOTUS boost for Euro CLOs

    US regulators last month added new guidance to their list of frequently asked questions (FAQs) on the Volcker Rule that should permit most non-US banks to invest in covered funds that are sponsored, managed and marketed by third parties. The move is especially significant for European CLOs, as it indicates that non-US banks will be able to invest in European .......

    News 13 March 2015

  • Liquidation list looms

    The hectic pace in European secondary securitisation markets looks set to continue today with six BWICs currently due, but of those a large CDO liquidation list will dominate attention.

    Despite the heavy volume of BWICs yesterday, the market absorbed the supply and the majority of line items traded well. Off-BWIC the tone was also positive particularly for Portuguese and UK .......

    SCIWire 13 March 2015

  • Entrants encouraged

    More managers could benefit European CLO market

    The European CLO market is smaller than its US counterpart, but arguably provides greater scope for a good manager to outperform. With the pool of European managers currently limited, equity investors are among those who would welcome new entrants.

    The CLO market has learnt many lessons from its 1.0 days, not least that in Europe there were too few assets. .......

    News Analysis 13 March 2015

  • US CLOs look to double-Bs

    The US CLO secondary market appears to be shifting attention towards double-B paper.

    "The market has shifted focus towards double-Bs and is now testing levels in that part of the stack," says one trader. "There are quite a few of relevant bonds appearing on BWIC and we'll have a clearer idea of where double-Bs are after those lists trade today .......

    SCIWire 12 March 2015

  • RFC on SME CLO approach

    Scope Ratings is requesting comments on its new SME CLO rating methodology. Its proposals include forward-looking and through-the-cycle base-case assumptions, with the aim of providing more rating stability, particularly for high investment grade ratings.

    In addition, Scope believes that the credit assessment of a sovereign is not an adequate anchor for a rating cap, particularly in eurozone countries. Rather, the .......

    News Round-up 12 March 2015

  • Trader guilty of CLO fraud

    Former Nomura and RBS CLO trader Matthew Katke has waived his right to indictment and pleaded guilty in a Hartford, Connecticut federal court to participating in an alleged multimillion securities fraud scheme. Katke also entered into an agreement to cooperate in the US government's ongoing investigation.

    Between April 2008 and August 2013, Katke admitted that he and others conspired to .......

    News Round-up 12 March 2015

  • Euro secondary BWICs surge

    European secondary securitisation markets continue to be focused on BWICs as today sees especially heavy volumes.

    There are already more than ten ABS/MBS BWICs circulating for trade today accounting over a 100 line items. "There is a wide mix of sellers including asset managers and hedge funds across a wide range of assets, plus there are a few CLO lists .......

    SCIWire 12 March 2015

  • US secondary cools down

    After a hectic start to the week US secondary markets have cooled down today.

    "It's a relatively slow day today," says one trader. "We had decent volume yesterday, but that's slipped away today."

    Nevertheless, the recent positive tone remains, the trader suggests. "The market feels in very decent shape and things are looking good for next week - we've had .......

    SCIWire 11 March 2015

  • New covenant boosts CLO diversity

    Fitch says that the inclusion in recent European CLOs of an additional covenant on the largest ten obligors is credit positive, as they ensure greater portfolio diversity. The covenant should help to mitigate performance volatility, especially during stress periods.

    The additional covenant appears to have been included in structures as market best practice and typically limits CLO exposure to the .......

    News Round-up 11 March 2015

  • Dutch prime slows as CLOs pick up

    European secondary markets continue to see discrete activity with Dutch prime the latest area to see a slowdown as some European CLOs get a boost. Meanwhile, this week's heavy BWIC calendar continues to roll on.

    "The price guidance for the new STORM deal, which is wider than secondary, hasn't pushed spreads wider as some thought but it has put the .......

    SCIWire 11 March 2015

  • Euro CLOs stay slow

    The European CLO secondary market is continuing to see limited activity this week.

    "There's still not much going on," says one trader. "What is trading revolves around 2.0 paper, plus some senior 1.0 and junior mezz 1.0."

    The trader continues: "Everything else is at an impasse. That's primarily because we've reached a price versus DM point that means investors realise .......

    SCIWire 10 March 2015

  • CLO controlling stakes surface

    It's already ramping up to be another busy week in the US CLO secondary market, but unusually the auction calendar includes a notable number of controlling equity stakes.

    "Unusually there's a decent amount of controlling equity on the schedule for this week," says one trader. "There's a total of around $205m of 1.0 and 2.0 equity in for the bid .......

    SCIWire 9 March 2015

  • US secondary stays bullish

    US secondary securitisation markets, particularly CLOs, are ending a strong week in bullish mood.

    "We're seeing better buying from all types of investor from banks to real money," says one trader. "As a result, spreads are tighter across the board and everything feels as if it will stay positive for now, whether that's CLOs, CMBS or RMBS."

    The positive tone is .......

    SCIWire 6 March 2015

  • Duration changes weighed

    US CLO structures that experiment with duration parameters are emerging ahead of the risk retention effective date. A recent JPMorgan research note looks at the pros and cons of shortening non-call periods and including delayed draw notes in transactions.

    A number of early 2015-vintage US CLOs have been structured with non-call periods ending before the effective date to provide equity .......

    News 6 March 2015

  • Risk retention uncertainties remain

    Fitch suggests that many small US CLO managers will find it difficult to comply with new risk retention rules. While several strategies are emerging to assist CLO managers with the rules, their effectiveness in satisfying regulatory requirements remains uncertain.

    In one strategy, banks that arrange CLO collateral provide financing by taking vertical strips. In another, a majority owned affiliate with .......

    News Round-up 6 March 2015

  • CLO shop taps lawyer

    Eagle Point Credit Management has hired Daniel Wohlberg as vp. He will assist the senior investment team in all facets of the investment process, focusing primarily on the analysis and negotiation of CLO trade documentation.

    Previously, Wohlberg was an associate at Dechert, where he advised financial institutions, hedge funds, underwriters, issuers, institutional investors, asset managers and sponsors in structured finance .......

    Job Swaps 6 March 2015

  • Hurdle ahead for US CLOs

    The broad-based US CLO secondary rally is continuing, but will face its biggest hurdle so far later today.

    "We've seen continued tightening across the capital structure and that's brought out a lot of sellers trying to take advantage of the strength," says one trader. "As a result, it's been a busy week with a lot of BWICs, but that hasn't .......

    SCIWire 5 March 2015

  • Euro secondary ticks over

    European secondary markets are quiet, but activity is still ticking over.

    "Secondary is reasonably quiet, but we are getting stuff done particularly around peripherals and non-conforming plus a little in CLOs," says one trader. "There's not much on BWICs again today, though there are some RMAC equity residuals later in the day, which might be quite interesting."

    The drop-off in .......

    SCIWire 5 March 2015

  • Failed bank's assets acquired

    Triumph Capital Partners has acquired all the equity of Doral Money and certain related assets in connection with the FDIC auction process for Doral Bank. As a result, the firm has acquired the management contracts to two active CLOs consisting of approximately US$703m in AUM.

    The move brings Triumph Capital Advisors' outstanding AUM to approximately US$1.7bn. In addition to the .......

    Job Swaps 4 March 2015
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