Insurance giant AIG is in the market warehousing loans for a new collateralized loan obligation, as the firm seeks to be opportunistic with the current spreads on offer. There are good yields available, though the liabilities right now are expensive, explained a market source. AIG would like to be in a position to launch the new CLO within the next couple of months, he added, noting that the plans are still at an early stage. AIG has created a warehouse line with a bank--that could not be determined--but has not yet chosen the lead to raise the debt, the source said. The potential CLO will add to the massive $4 billion AIG has in loan assets under management and would be the firm's fifth structured loan vehicle. Officials at AIG declined comment.
Potential banks to lead the CLO include the usual repertoire of Credit Suisse First Boston, J.P. Morgan, Wachovia Bank, Morgan Stanley and Deutsche Bank, said the official. CDC IXIS could also be considered, he added, after the French bank brought on board Ken Wormser, former managing director and head of CIBC World Markets' asset securitization group, and Wormser's entire team last month. "There is some advantage to being [CDC's] first," he said, noting that the firm would throw everything into its initial effort. "It is very important for [CDC] to take someone to market." Additionally, CIBC led one of AIG's first CLOs.