CDOs/CLOs

Deals, trends and research in structured finance and asset-backed securities for the week of Aug. 28-Sept.3

This year has already seen a glut of corporate failures: there were 177 U.S. bankruptcy filings year-to-date by companies with over $50 million in liabilities, according to data compiled by Bloomberg

There’s been a flurry of interest in so-called fallen angels recently as investors seek alternatives to the ultra-low yields on high-grade debt.

The transaction is the first in two years for MidCap, which provides startup and expansion financing for biosciences/healthcare and technology firms backed by VC and private equity.

The industry’s turmoil, including 'strategic options' being pursued by corporate debt obligors like Transocean and Seadrill, has sparked the biggest wave of restructurings since 2017, when the effects of the last oil price downturn reverberated through the industry.

Investors should consider alternatives such as private credit as they search for positive yield in a world of low or negative interest rates, according to asset manager Nuveen LLC.

As the tally of corporate defaults climbs, the potential for collateralized loan obligation ETFs may pose a risk for retail investors, according to GTS Mischler Principal Reggie Browne.

More than 2,500 Fitch-rated structured finance transactions face significant challenges transitioning from Libor to an alternative floating-rate benchmark, but the ratings agency doesn’t foresee that resulting in potential ratings downgrades until 2022.

There is hope among issuers that the structural changes brought about by the COVID-19 pandemic can bolster CLO resiliency, thereby enabling market participants to better weather the next economic storm.

The coronavirus impact in the U.,S. alone has resulted in a 30% year-over-year decline across securitizations, CLOs and MBS.