Triple-A CLO spreads continue to tighten despite the absence of Japanese banks

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By Paola Aurisicchio
22 Feb 2021

The US CLO market is gaining positive traction in the first quarter of the year, with strong demand from investors, and spreads continuing to tighten, despite the absence of the Japanese banks, traditional anchor buyers of the senior tranches.

The heavy supply in new issue CLO, alongside with a flurry of refi and reset, hasn't slowed down the spread tightening in some parts of the capital stack, which has brought senior coupons close to a record for the period following the 2008 financial crisis, according to estimates ...

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