The asset manager sold a $416m static transaction through Société Générale, which was backed by a pool of mostly mid-market loans. The CLO was priced last week and includes $247m of senior notes, rated AAA by Kroll and S&P, sold at a coupon of 185bp over three month Libor.
The transaction is backed by a static pool of loans, and the deal has an exposure to 46 obligors, according to a preliminary rating report from Kroll.
Golub Capital, a mid-market loan and CLO manager with an established BSL programme, priced its first TALF CLO backed by a pool of mid-market loans in October.
It is the only manager to take advantage of the TALF programme, which has been widely criticised by market participants and is seen as too limited to reboot the wider CLO sector.
The major friction, according to sources, is that TALF is only applicable to triple-A tranches on static CLOs, which are a small portion of the CLO market and are usually structured by specialised managers.
In order to be eligible for TALF funding, CLO managers must also meet various pool requirements, which few deals have managed.
The Fed accepts static CLOs backed by leveraged loans priced since January 1, 2019 to the TALF programme. Among other conditions, the CLO must be issued on or after March 23, 2020 and its maximum second-lien loan concentration has to be 10%.
The TALF interest rate for CLOs is 150bp over 30-day average Sofr. The programme will expire on December 31.