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Garden State Manager Launches CDO Of CDOs

15 Dec 2002

Zais Group originated its second collateralized debt obligation of CDOs of the year. Called Zing V, the $400 million transaction was underwritten by Deutsche Bank. The deal, which is backed almost entirely by other CDOs, is set to close Thursday. Calls to the syndicate desk at Deutsche Bank were not returned by press time last Thursday. Christian Zugel, president of the Red Bank, N.J.-based asset management firm, declined to comment. Zais is a collateral manager that specializes in CDOs of CDOs and is said to have launched the first deal of this type with its Zing I transaction in 1999.

The collateral mix for Zing V is 90% CDO securities--from triple-A to double-B--and 10% corporate bonds. The triple-A rated notes were priced at 60 basis points over LIBOR. The double-A rated tranches were priced at 130 basis points over swaps. The single-A floating notes were priced at 190 basis points over LIBOR. The single-A rated fixed-rate notes had a spread of 190 basis points over swaps.

15 Dec 2002