Uncertainty surrounding Greece and China have weighed on risk assets, including CLOs, demand has remained relatively strong even as supply accelerated at the end of the quarter.

Richard Hill

Categorized in : Money

We did not ask that any mural be taken down, this has nothing to do with any mural, it has to do with the fact that a fence was built without a permit.

The building inspector went out and looked at it, and gave them a notice, they went back and the owners still didn’t have a permit, so they gave them a warning. The city did its job.

CMBS and corporates have widened significantly since July with the issues in Greece and China, cLOs have widened as well, but it hasn't been as much.

The CLO market has decoupled from other markets, relative to CMBS and other corporate, this is one of the first times that CLOs are trading tighter or on top of CMBS.

Given that CLO managers are typically thinly capitalized, it is hard to envision that many small managers will have access to the long-term capital that risk-retention rules would require, unlike the last CLO manager consolidation cycle that followed the financial crisis, we believe this time around the consolidation economics are not as compelling given a combination of smaller post-crisis CLO management fees and shorter reinvestment periods.