Volcker CLO relief effort losing momentum amid ‘regulatory incrementalism’

Federal Reserve Dollar
By Will Caiger-Smith
09 Apr 2014

The Fed’s decision to give banks two more years to make sure their CLO investments conform with the Volcker rule’s ban on deals that include bond collateral falls short of the full grandfathering regime the industry was hoping for — and risks derailing the positive momentum the market chose to believe was driving efforts to soften the impact of the rule, sources have told GlobalCapital.

Four CLO managers — NewStar Financial, Golub Capital Partners, CIFC Asset Management and Bradford & Marzec — priced deals this week, bringing total issuance this year to over $25bn. But the optimism that had been supporting strong triple-A demand and drawing some bank investors back into the market ...

Already a subscriber?

Continue reading this article

Try full access to GlobalCapital

Free trial