CLO primary fades after flurry of issuance; Japan’s proposed risk retention rules eyed

By Rebecca Melvin

New York, Jan. 24 – No new issues were heard to have priced in the collateralized loan obligation market on Thursday, but the market has perked up in recent sessions after getting off to a quiet start for 2019.

Credit Suisse Asset Management Ltd. priced this past week what appears to be the first euro market CLO, with a €407.4 million of notes due Jan. 15, 2032 in the Cadogan Square CLO XIII DAC deal. It included €1.5 million of class X floating-rate notes (Aaa/AAA) priced to yield Euribor plus 50 basis points and €246 million of class A floating-rate notes (Aaa/AAA) at Euribor plus 100 bps.

In the U.S. primary market this week, GoldenTree Asset Management LP priced $807.25 million of notes due April 24, 2031 in the new GoldenTree Loan Management US CLO 4 Ltd./GoldenTree Loan Management US CLO 4, LLC deal, which includes $5.75 million of class X floating-rate notes (AAA) at Libor plus 80 bps and $476 million of class A floating-rate notes (AAA) at Libor plus 129 bps; and Ares Management LLC priced $507.05 million of notes due April 15, 2031 in the new Ares LI CLO Ltd./Ares LI CLO LLC transaction.

Meanwhile, market participants remain focused on concerns with Japan’s proposed risk retention requirements.

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