CypressTree Eyes Loan-Only CDS

CypressTree Investment Management is looking to add credit-default swaps on loans to its existing leveraged loan funds.

  • 23 Jun 2006
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CypressTree Investment Management is looking to add credit-default swaps on loans to its existing leveraged loan funds. Richard Omohundro, senior managing director and chairman of the investment committee, said the group wants to see loan contracts follow those of pay-as-you-go synthetic asset-backed securities, in which there is a partial pay option upon a credit event. "We are dabbling our toes in it at the moment, but will be swimming when the market gets going," he said.

CypressTree currently manages a synthetic collateralized loan obligation and also uses currency hedges to mitigate the foreign exchange risk for its non-U.S. dollar investors. "Derivatives are a very efficient way to manage what we do," Omohundro said. In addition, the manager is growing its investments in European cash loans, adding the assets to existing U.S.-based portfolios. Omohundro cited the attractive spreads, sizes and prices of European loans for the move across the Atlantic, as well as an expected wave of issuance in Europe and its convergence with the U.S. market.

The group launched a London outpost earlier this year, led by former head of fixed-income research at Barclays Bank, Jim Kean. Kean's former colleague, Pierre Bose, a European strategist, has also joined the London office reporting to Kean.

  • 23 Jun 2006

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 BNP Paribas 13,823 26 18.14
2 Bank of America Merrill Lynch (BAML) 8,207 26 10.77
3 Lloyds Bank 7,202 22 9.45
4 Citi 6,256 16 8.21
5 JP Morgan 5,220 8 6.85

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 105,474.10 301 10.96%
2 Bank of America Merrill Lynch 86,762.28 250 9.02%
3 JPMorgan 81,465.60 238 8.47%
4 Wells Fargo Securities 77,934.65 225 8.10%
5 Credit Suisse 63,570.21 165 6.61%