CLOs Revisited – Ratings, Risks, and Returns (Fourth of a Series)

Competition in leveraged loans, keen as it is, pales in comparison to the 2021 Mrs. Sri Lanka pageant. Reigning Mrs. World champion, Caroline Jurie yanked the tiara off newly-crowned winner Pushpika DeSilva, charging Mrs. DeSilva was not married. Mrs. DeSilva fled the stage in tears. Order was eventually restored. Mrs. DeSilva reclaimed her crown, and…

CLOs Revisited – Ratings, Risks, and Returns (Third of a Series)

By blocking the Suez Canal last month, the Ever Given made headlines and created a massive shipping traffic jam. Three football fields long and weighing 250 thousand tons (by comparison, the Statue of Liberty is 125 tons), the monster container vessel represents the new global transportation reality: 90% of the world’s goods travel by sea….

CLOs Revisited – Ratings, Risks, and Returns (First of a Series)

“Anytime loan market technicals shift, there’s always a view that CLOs are the end of Western civilization as we know it.” So a top CLO manager related his experience over several decades. Regardless of actual historical performance, collateralized loan obligations are periodically hauled out by the media, excoriated for reckless behavior, and dismissed as just another…

Leveragin’ Loans

So much that was disturbing about the news last week. Social media was abuzz with opinions flying on both sides. Twitter was filled with long-submerged memories of crazy times hanging out at…everyone’s favorite orange-and-red java shops. We’re referring, of course, to the decision by Dunkin’ Donuts to drop “Donuts” from the brand name. In today’s…

You Can Fight City Hall

It seemed like a one-in-a-million shot at the time. In October 2014, the LSTA filed a lawsuit against the SEC and the Federal Reserve Board, claiming that CLOs should not be covered under Dodd-Frank’s risk retention rules. These rules, arising from the credit crisis, required parties that securitized assets to retain at least 5% equity…

State of the Loan Market (Third of a Series)

Besides the Annual LSTA Conference, the other recent industry gathering of note was the Creditflux CLO Conference in NY. The focus here was trends in structured finance, from both issuer and investor perspectives. Collateral loan obligations, as we’ve covered in a special series [link], represent the majority of loan buyers in the broadly syndicated market….

The Lead Left - A Special Report: Why CLO's Matter

Beginning in June 2014 The Lead Left published a series of articles discussing the relative merits of investing in middle market senior debt and their broadly syndicated counterparts. This report consolidates those articles: What is a CLO? CLO’s role in the demand side The Value of Middle Market CLOs How next gen vehicles will deal with […]

The Desktop 2015 CLO Market Outlook

The Desktop 2015 CLO Market Outlook presented by David Preston, CFA and Jason McNeilis, CFA at Wells Fargo Securities Current Market Environment Spread Outlook CLO Primary Outlook Euro CLO Outlook Regulatory Outlook Loan Market Overview Risk Assessment