CDOs/CLOs

Deerfield Capital Corp. entered into three supplemental indentures on July 31 with the holders of the trust preferred securities issued by each of Deerfield Capital Trust I, Deerfield Capital Trust II and Deerfield Capital Trust III.

If the leverage finance market has a Mickey Rourke - the actor who wrestled his way back on top - it would probably be the CLO manager. CLOs have experienced a comeback recently, mainly because secondary prices have improved since the first quarter. But market participants believe that CLOs are still on the ropes, and will be for the rest of the year.

Maxim Group expanded its fixed-income team with three additions, the New York-based investment bank announced today. The three new executives will all serve as traders.

KKR Financial Holdings has delevered four of its CLOs to boost liquidity, and the company projects a quarterly profit, it said Tuesday.

Ambac Assurance Corp. (AAC) released its estimated credit derivative impairment and loss as well as loss expenses for the second quarter, Ambac Financial Group said today.

After announcing it had downgraded approximately 500 tranches of 93 U.S and European CLOs, Moody’s Investors Service said Monday that the majority of top-rated CLO tranches are in danger of losing their triple-A rating.

CLO managers are finding creative ways to restructure their portfolios. Following Morgan Stanley’s announcement last week that it would repackage downgraded CDO tranches backed by leveraged loans into new triple-A-rated securities—the first strategy of its kind — Egret Capital has also come up with a new restructuring tactic.

The Committee of European Securities Regulators (CESR) will today publish its final report and feedback statement on the transparency of corporate bond, structured finance product and credit derivatives markets.

When the average person hears the words deep discount, a smile is likely to appear. But when a CLO manager hears those words, it can cause them to shiver. That’s because so-called deep-discounted loan substitutions are a huge problem for CLO managers, though some firms and industry organizations have been working to change that by raising awareness on the issue. And they now say they are making progress.

New York-based Primus Asset Management has acquired CypressTree Investment Management, a Boston-based investment management firm focused leveraged loans and high yield bonds.