In a reversal from first-quarter trends, Babson Capital reports that spreads tightened slightly in both the U.S. and Europe for AAA paper in CLO 2.0 issues while lower-rated mezzanine tranches saw widening spreads of 20 bps.
TPG Institutional Credit Partners and PineBridge Investments are in the market with two collateralized loan obligations totaling nearly $1 billion.
The Federal Reserves two-year deadline extension for banks to conform their collateralized loan obligation holdings to the Volcker Rule already has a troubling limitation, an industry trade group spokesman said Wednesday at a CLO conference in New York.
A Federal Reserve limitation on the two-year extension it granted banks to bring CLO holdings into Volcker Rule compliance will end up harming divestiture efforts, a trade group spokesman said.
Leveraged loan issuance of $276 billion in the first three months of 2014 was down from this period a year ago. But it still ranks as the third-highest volume on record since 1987.
Asset-backed and mortgage-backed securitization volume is at its lowest year-to-date volume since 2009, a steep drop from its position at this point last year, according to Dealogic.
January was an active month for high yield bonds on the primary market and was the most active month since this past October.
Business development companies, which have become important lenders to small and medium sized companies, could get some additional financial muscle, potentially putting them in more direct competition with banks.
Managers arent waiting around to see if collateralized loan obligations get a last-minute reprieve from the Volcker Rule. Some recently priced deals, by managers including Columbia Management Investment Advisors and Black Diamond Capital Management, have provisions for excluding investments in corporate bonds.
3i Debt Management named Michael Curtis as a portfolio manager based in its London office. Curtis was most recently a portfolio manager with Alpstar Capital.