Latest news
Latest news
Borrowers take advantage of robust CLO demand to tighten leveraged loan pricing
New realm for ex-Natixis banker, as HSBC Innovation Bank hires
Manager reset the deal for the second time as the end of its reinvestment period approached
More articles
More articles
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Ares Management has increased the size of one of its largest CLOs still further, resetting a $1.1bn transaction originally priced in 2017 and taking the opportunity to crank the deal up to a par value of $1.9bn. -
The Covid crisis has made the CLO market stronger and more attractive to investors, but it has also taught the CLO community to defend itself from distressed debt funds, agreed panellists at the IMN and FIIN conference in the session focused on the CLO market recovery.
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Plenty of CLO managers are still failing their weighted average rating factor (WARF) tests on both sides of the Atlantic, limiting their capacity to buy new lower-rated deals, even as banks bring some of their most challenging offerings to market as the quarter closes.
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Extra large deals continue to flood into the market, with Elmwood Asset Management resetting its $930m 2019 deal Elmwood CLO II.
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Crescent Capital has partially refinanced the first CLO to include an applicable margin reset (AMR) auction option in its documents, making use of the online process. More online repricings are expected to follow, as the market environment makes the refi process attractive and it can cut costs and administrative challenges for CLO managers.
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Japanese regional banks are turning their attention to the CLO market, even as the country’s best-known anchor buyer, Norinchukin, remains on the sidelines. These institutions are struggling with ultralow interest rates and are seeking opportunities abroad, attracted by the asset’s strong performance during the pandemic.
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CLO managers have begun to reset their Covid-era deals, slashing liability costs, as illustrated by AGL Credit Management, which shaved 114bp off the margin of a senior tranche originally priced in April 2020.
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Ivy Hill Asset Management, an affiliate of Ares Management, has returned to the CLO primary market after a three year hiatus with a CLO backed by loans to middle market companies.
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Symetra Financial Corporation, a financial services insurance company and the US subsidiary of Japan-based Sumitomo Life Insurance, increased its investment in CLOs by $1bn during 2020, and may have increased the pace of buying more recently, taking 'sizeable' positions in triple-A tranches from from late last year, according to a source.
