As we’ve highlighted previously,funds that invest in private corporate credit (PCC) (e.g., commingled funds, separately managed accounts and business development companies (BDCs)) often utilize collateralized loan obligations (CLOs) as a financing mechanism.
Earlier this month, the International Organization of Securities Commissions (“IOSCO”) published its Final Report on “Leveraged Loans and CLOs Good Practices for Consideration,” concluding several years of work conducted by its member working group. In response to IOSCO’s September 2023 Consultation Report), the LSTA and other industry commenters urged IOSCO to reconsider publishing this Final...
In 2020, the Government Accountability Office (“GAO”) published an extensive report on Financial Stability and leveraged loans, noting that “[a]lthough regulators monitoring the effects of the pandemic remain cautious, as of September 2020, they had not found that leveraged lending presented significant threats to financial stability.” Notwithstanding the GAO’s findings and the leveraged loan default...
In this whitepaper, the LSTA reviews the official sector’s definitions of systemic risk, characteristics of systemic risk and transmission channels for systemic risk. We analyze leveraged loans and CLOs’ characteristics to demonstrate why they do not post a systemic risk to the U.S. financial system. ...
In this video, we discussed the LIBOR transition process and the decision points for CLOs. Presented by Meredith Coffey of the LSTA, Nicole Skalla of Paul Hastings, and Tess Virmani of the LSTA. The slides shown throughout this video are available for download....
ESG is an increasing issue for credit quality, and financial market stakeholders are identifying a growing number of ESG-related risks. Join us for a discussion with S&P experts on how the extent of ESG risks are measured, and how S&P compares issuers who are increasingly trying to reduce their exposure to ESG risk. This replay...
A recent internet meme posits that the U.S. banking system is on the precipice of collapse. Today’s catalyst,the Collateralized Loan Obligation or CLO, the theory goes, bears a resemblance to the similarly named CDO, which played a role in the 2008 financial crisis....
