CLOs

  • US CLOs continue double-B focus

    US CLO secondary activity continues to lean toward double-B paper in both 2.0 and 1.0 form.

    "We're seeing a continued flurry of 2.0 double-Bs on BWIC today and tomorrow," says one trader. "And we've got the same theme going on around them of sector tiering particularly with regard to energy exposure, but there's also now some healthcare impact."

    The trader reports .......

    SCIWire 3 February 2015

  • CLO administration tool unveiled

    Deutsche Bank has launched a new collateral administration tool designed exclusively for CLO managers to access their transactions via the bank's Autobahn App Market. Dubbed Deal Hub, the offering streamlines the way clients access and manage their portfolios by providing a direct online portal to CLO information, including current positions and characteristics on loans, cash balances and periodic reports, as .......

    News Round-up 3 February 2015

  • Post-crisis CLO index outperforms

    JPMorgan's latest CLO index (CLOIE) monitor report shows that US$2.8bn in par outstanding of CLOs paid down in the index since the last rebalance through 30 January, split between US$2.4bn and US$400m of pre-crisis and post-crisis CLOs respectively. The post-crisis CLOIE added US$8.8bn across 114 tranches from 22 deals at the January rebalance.

    The post-crisis CLOIE last month outperformed the .......

    News Round-up 3 February 2015

  • CDO/CLO BWICs burst into life

    Today and tomorrow see a significant burst of CDO/CLO BWIC supply either side of the Atlantic that is notable in terms of both volume and variety of bonds on offer.

    There are ten auctions already scheduled for today and tomorrow covering 81 line items and 311.7m in original face. Tomorrow's lists look likely to provide the most interest as they .......

    SCIWire 2 February 2015

  • US CLOs edge in

    Secondary US CLO spreads are edging in on the back of increased investor demand.

    "Secondary market technicals are definitely getting better," says one trader. "Customers seem willing to pay up a little more, so spreads are tightening."

    The trader continues: "That's mainly driven by the feeling that there won't be as much new issuance this year as there was last. So, .......

    SCIWire 30 January 2015

  • Covenants strengthened on liquidity concerns

    The introduction of minimum obligor debt issuance covenants in recent European CLOs is likely to be driven by market liquidity concerns, Fitch suggests. Based on the exposure in CLOs to date, there are only small differences in the default likelihood and recovery prospects between borrowers of different sizes, the agency says. The exposure to obligors with less than €200m of .......

    News Round-up 30 January 2015

  • CLO FX risk examined

    Fitch says liability currency hedges in European CLOs are less effective than perfect asset swaps (PAS), by exposing the transaction to FX risk. The agency believes this could be due to asset defaults or due to different repayment profiles between euro-denominated assets and non-euro assets.

    Such structures avoid costly PAS and hedge foreign currency exposure by issuing liability tranches also .......

    News Round-up 30 January 2015

  • Euro secondary stays firm

    Despite broader market volatility European secondary spreads held firm throughout yesterday and into today.

    The large volume of BWICs dominated the market yesterday, but all traded at or above talk. Off the back of the lists and in secondary more broadly there was healthy activity notably again in UK non-conforming and buy-to-let RMBS as well as increased, but patchy, trading around .......

    SCIWire 30 January 2015

  • US CLOs/CDOs stuck on repeat

    The US CLO/CDO secondary market appears stuck on repeat this week.

    "There's not a great deal of volume on BWIC today and, again, a fair proportion is lists postponed from earlier in the week," says one trader. "That's partly why we're seeing the same themes over again - dominance of 2.0 deals in the triple-A to double-B range. It's also, of .......

    SCIWire 29 January 2015

  • US CLOs/CDOs in discovery mode

    After a disrupted week the US CLO/CDO market is busy today, especially with many BWICs carried over from yesterday. However, as one trader says: "It feels a little like we're still in price discovery mode."

    The recent heavy focus on 2.0 lists hasn't helped, but even then the bottom part of the capital structure isn't featuring significantly either. "There's not .......

    SCIWire 28 January 2015

  • CLO space stays active

    The storm battering the north-eastern US put a freeze on most secondary market activity yesterday, although a number of US CLO bid-lists did circulate. SCI's PriceABS data captured price talk on 39 unique US CLO tranches during Tuesday's session.

    Most of the paper out for the bid came from post-crisis issuances, with tranches such as MCAP .......

    Market Reports 28 January 2015

  • Euro secondary activity up

    The European secondary markets are seeing increased activity across jurisdictions and securitisation asset classes.

    "There have been good two-way flows over the past two days," confirms one trader. "Most price levels are up in ABS, CLOs and MBS."

    Dutch prime paper continues lead the way hitting record lows again yesterday. For example, a five-year DOLPH senior covered at around 25 .......

    SCIWire 28 January 2015

  • CLO performance stays strong

    CLO performance was positive in 2014 says S&P, with 75% of its ratings remaining stable and upgrades exceeding downgrades by nearly five times. The agency adds that the momentum of issuance in CLOs in 2014 looks set to continue into 1H15.

    Overall assets rated in the triple-C category have decreased since 3Q14. There has been an increase in the 2013 .......

    News Round-up 27 January 2015

  • CLO expansion creates challenges

    The CLO market has experienced a 65% growth in issuers, with 47 new managers entering during 2013 and 2014 through October, according to Fitch. As a result, new entrants to the market are taking advantage of favourable conditions to enter a space historically dominated by large institutional firms.

    The profile of newer entrants is different than the standard CLO 2.0 issuers .......

    News Round-up 27 January 2015

  • Euro CLOs on the rise

    After a slow few weeks, European CLO secondary market volumes are on the rise.

    "We've seen very little flow across the board as players have held back waiting on macro issues, the ECB, Greece and the Fed," says one trader. "What trading there has been is mostly in 1.0 mezz and 2.0 upper mezz."

    However, the US Federal Reserve meeting .......

    SCIWire 27 January 2015

  • Euro spread series introduced

    JPMorgan has introduced a new issue spread series for European CLO 2.0 deals that is designed to be an additional gauge of relative value for investors on both sides of the Atlantic. In addition, the bank has commenced issuing formal European CLO 2.0 recommendations.

    These recommendations begin with being overweight triple-A to single-A tranches, given the relative value to European .......

    News Round-up 26 January 2015

  • Euro CLO BWICs quiet for now

    After the swathe of BWICs on Friday, the European CLO auction schedule currently looks considerably quieter. However, given the strong levels of execution seen on Friday's lists, albeit believed to be primarily driven by dealer inventory building, more BWICs are likely to be added soon.

    For now, there is only one list scheduled for today - a €9.628m six line .......

    SCIWire 26 January 2015

  • Manager league tables released

    Although the top 10 CLO managers in the US, Europe and globally is relatively unchanged from December 2013, the top 10 US managers' share of the market - by assets under management - slipped to 30% from 34%, according to Moody's latest CLO Interest publication. For 2014, US and European CLO issuance reached all-time and post-crisis records respectively.

    In the .......

    News Round-up 23 January 2015

  • Euro CLO schedule surge

    European CLOs are seeing an uptick in secondary activity thanks to broader securitisation market positivity on the back of QE and consequently there is a surge in the BWIC schedule for today.

    There are already four lists circulating covering 23 line items. First up, and attracting most market interest, is a 17 line €45.23m predominantly equity list of 1.0 bonds .......

    SCIWire 23 January 2015

  • Energy concerns weigh on US CLOs

    Energy price concerns among others could hinder US CLO secondary trading today.

    As noted yesterday, a highlight of today's US CLO BWIC schedule is the $112.68m six line equity list due at 11:00. However, one trader says: "Investors seem to be happy to sit on the sidelines for this one. They are good bonds with very good managers and on average .......

    SCIWire 21 January 2015

  • Europe's waiting game continues

    It's still an ECB waiting game in European secondary markets but sentiment remains positive.

    "It's still mainly about waiting on some ECB action tomorrow," says one trader. "But sentiment is good, albeit on quite thin flows, so we're seeing a continuation of the tightening trend especially in UK and Dutch prime."

    UK non-conforming RMBS is also continuing to attract interest, .......

    SCIWire 21 January 2015
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