Despite a surge in middle-market CLO issuance in the fourth quarter, total production of structured credit deals drifted lower in late 2022. Blackstone was the most active sponsor, while JPMorgan led in CLO underwriting. (Includes two data charts.)
The proposed rule is meant to prohibit ABS issuers from engaging in “conflicted transactions” that could influence the deal structure in a way that puts their interests ahead of those of investors.
If the Second Circuit reverses a district court ruling and holds that a syndicated term loan is a security, the implications would be immense for banks, CLOs and other parties.
CLO issuance backed by broadly-syndicated loans held fairly steady in the third quarter, but the CRE sector tanked and refi/restructuring fell off the edge of the cliff. (Includes two data charts.)
Stress testing suggests that broadly syndicated loan CLOs are resilient to collateral depreciation, according to Fitch. Though DBRS expects some reduction in credit quality increased defaults.
Private equity investors are turning to collateralized fund obligations, which include some features from the collateralized loan obligation sector. KBRA rated its first CFO last week.
Rising mortgage interest rates increased the market share of jumbo loans, ARMs and expanded-credit mortgages in the second quarter, while the agency market shrank. The result was a downturn in securitization rates. (Includes data chart.)
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