Harvest CLO XVII is the fifth new Euro-denominated collateralized loan obligation transaction of the year, with a pool of both secured term loans and high-yield bonds backing seven classes of rated notes and an unrated subordinate tranche. The size of the transaction is to be determined.
The time it takes to acquire a diversified pool of collateral is lengthening, yet banks are loathe to make warehouse lines of credit available for too long. So warehouse lines are being structured so as to attract capital from outside investors.
Morgan Stanley research stated that department stores account for only 6% of CLO retail exposures, there is more than $920 billion of loan exposure from Neiman Marcus residing in outstanding U.S. CLOs. Unfortunately for these CLOs, Neiman Marcus debt is priced near 80 cents on the dollar.
The indicative portfolio consists of 115 loans from 105 high-yield, speculative-grade borrowers with 13.3% of the loans concentrated in the telecom corridor, according to Fitch's presale report.
Littlejohn & Cos Wellfleet Credit Partners and mid-market corporate lender NXT Capital have each priced their first collateralized loan obligation of the year.
Treasurer, Head of Asset Management
Firm: NewStar Financial
Owning may offer consumers more savings than leasing, but loans pose a different set of risks to investors when pooled into collateral for bonds.Current Issue