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Derivatives

Asian CDOs Reference Asian Names

Demand for synthetic collateralized debt obligations in Asia referencing Asian names appeared on the radar this year, when UBS started working on a deal (DW, 11/3).

Demand for synthetic collateralized debt obligations in Asia referencing Asian names appeared on the radar this year, when UBS started working on a deal (DW, 11/3). Rachel Hardee, head of Asia Pacific structured credit at Derivative Fitch in Hong Kong, said there have been a good number of such deals recently, including the Standard Chartered Start III CLO that referenced 80% Asian loans. "Investors are increasingly looking to diversify...they [already] have U.S. and European investments," she explained.

Hardee also noted that Hong Kong, Singapore and Japan have demonstrable stability. Moreover, a handful of Asian sovereigns have become investment grade including Taiwan, Malaysia and recently India.

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