September 5, 2019 - Our own Lee Shaiman, Executive Director of the LSTA, recently contributed a by-lined article on the health of the CLO industry to Pensions & Investments. The outlet is a leading, go-to news source for institutional investors such as pensions, endowments, insurance companies and similar entities. The article explains that there are a number of reasons why CLO notes should remain attractive investments within well-diversified portfolios:
“As institutional investors continue to evaluate CLO investment opportunities, it is essential to look past misleading headlines and focus on realities. Focus also should be placed on evaluating the outlook for the leveraged loan market.
The credit risk that exists in the market is manageable. In fact, non-investment-grade borrowers’ debt servicing ability remains strong, and there is no evidence that companies are anywhere close to being unable to repay or service obligations. Even Federal Reserve Chairman Jerome Powell echoed this sentiment this year when he told Congress the leveraged loan market is not systemically risky.”
The full version of the article can be read here. The LSTA is committed to being an educational resource and insightful commentator for news outlets, and continuing to contribute similar viewpoints in the months to come.