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CLOs ditch riskiest tranche as markets widen

CLOs

CLOs ditch riskiest tranche as markets widen

The ‘normalisation’ of the CLO market has stalled, with spreads for single-B tranches now at levels where issuing makes little sense, pushing many managers to retain these notes or print lower levered deals.

European CLO market adapts to the challenges of the COVID-19 era


The period since March has been a turbulent time for financial markets, and the CLO sector in Europe dealt with a complex set of disruptions when the pandemic arrived this spring. From sudden and acute stress at the corporate level, to an unprecedented shift in working conditions, CLO players in Europe experienced uncertainty not seen since the last crisis. Yet, the market has adapted, and while the shape and size of deals may be different, CLOs in Europe are pushing ahead. BNY Mellon and GlobalCapital gathered market experts to discuss the present state of the European CLO market and its prospects.

European CLO market adapts to the challenges of the COVID-19 era

Other news

  • CLOs ditch riskiest tranche as markets widen

    CLOs ditch riskiest tranche as markets widen

    The ‘normalisation’ of the CLO market has stalled, with spreads for single-B tranches now at levels where issuing makes little sense, pushing many managers to retain these notes or print lower levered deals.

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  • Golub prices first TALF CLO but Fed program still lacks appeal, sources say

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  • China issuers sneak into closing bond window

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  • Cerberus challenges market to digest flood of mezz

    Cerberus Capital Management auctioned off one of the largest ever portfolios of UK mezzanine mortgage bonds on Thursday, following a deterioration in the terms available in the ABS repo market after the Covid crisis made it uneconomic to continue to hold the deeply subordinated and risky positions.

  • Permira splashes cash on Lowell rescue ahead of 2021 NPL splurge

    Permira splashes cash on Lowell rescue ahead of 2021 NPL splurge

    Permira opted to rescue its debt purchasing portfolio company Lowell from the restructuring that many thought was imminent, with the largest slug of equity support any sponsor has injected in Europe since the coronavirus pandemic began. Covid-19 has crushed cashflows for some debt purchasers, but next year should be a bumper year for NPL buying — for those firms with cash to do so, writes Owen Sanderson.

  • eBay Classifieds underlines strength of final market window

    eBay Classifieds underlines strength of final market window

    The €2.6bn financing for Adevinta’s purchase of eBay Classifieds looks set to be a blowout success, with sharp tightening across all tranches underlining the bid for quality credits enduring limited pandemic impact. The deal’s double-B rating helps attract rating-sensitive investors who have seen their portfolios pummelled this year by Covid-related downgrades.

  • Levfin bankers optimistic as liquidity returns

    Levfin bankers optimistic as liquidity returns

    Leveraged finance bankers coping with a slump in deal flow in Asia this year are gearing up for a bumper start to 2021, as a return of liquidity and growing interest from institutional investors for loans set the stage for a market revival. Pan Yue reports.

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