US CLOs enjoy busiest ever start to the year

More than $26bn of new issue CLOs have been priced in the year so far in the US, on top of $22.1bn of refinancing and reset deals as managers look to wring more returns from existing deals. The combined volumes in the first two months of the year are the highest in the CLO market’s 20-year history, said JP Morgan on Tuesday.

  • By David Bell
  • 13 Mar 2018
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The blazing start to the year comes on the back of what was the busiest year on record for the CLO market, with $245bn of paper sold in 2017 across new issue, reset and refinancing deals.

In the year to date, 93 deals have been priced in the US, totalling $48.2bn — $26.1bn excluding refis and resets. That compares with the $46.2bn sold in the same period last year.

Volumes in Europe are also tracking ahead of last year’s record issuance. So far, €7.9bn of paper has been sold, compared with €5.5bn during the same period last year.

So far this week, just one issuer has priced a new deal in the US market. Bain Capital Credit sold a $611.3m CLO via Citi on Monday, with the triple-A notes priced at a margin of 96bp over Libor. The deal has a two year non call period and five year reinvestment period.

PGIM is marketing a new $612m Dryden 64 CLO, which was announced on Friday, through Morgan Stanley. PGIM is following the same two yearnon call, five year reinvestment period as Bain.

In addition to the two new issues, two “call to roll” transactions have been in the market this week.

Palmer Square Loan Funding sold a $505.7m 2018-2 deal on Tuesday, with a static pool of assets. The deal has a 1.5 year non call period. The issuer redeemed a 2016-3 transaction last Friday. The triple-A rated ‘A-1’ class of the new deal was sold at 65bp over Libor.

Meanwhile, TICP CLO Management is rolling assets from a deal originally sold in 2014 into a new $496.88m structure. The deal, TICP CLO II-2, is a new vehicle that will be backed substantially by the redemption of TICP CLO II, which was originally sold in July 2014. The deal is being arranged by Citi. The bulk of the debt is in an ‘A-1’ tranche, rated triple-A by Moody’s, that has guidance of 80bp over Libor.

  • By David Bell
  • 13 Mar 2018

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 BNP Paribas 15,084 31 17.18
2 Bank of America Merrill Lynch (BAML) 9,637 29 10.97
3 Citi 8,093 21 9.22
4 Lloyds Bank 7,329 24 8.35
5 JP Morgan 6,580 10 7.49

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 128,786.28 373 11.20%
2 Bank of America Merrill Lynch 102,784.89 298 8.94%
3 JPMorgan 100,935.67 292 8.78%
4 Wells Fargo Securities 91,306.23 262 7.94%
5 Credit Suisse 75,962.58 202 6.61%