Bear Stearns, the most active arranger of Asian collateralized bond obligations (CBOs), recently rolled out its third Asian CBO this year. The latest one is managed by AXA Investment Managers Hong Kong.
The $60 million CBO is backed by a portfolio of US dollar-dominated securities consisting of 38 exposures from nine Asian countries. An offshore SPC called Asian Diversified Bond CBO Limited issued two classes of notes, A and B.
Class A was split into two pieces: an $11.5 million piece with 6.75% expected yield rated triple-A by Duff & Phelps and Moody's, and a $27.6 million piece with 8.75% expected yield, rated A/A2. The notes were placed mainly in Asia and Europe, while Class B's $20.8 million notes were unrated and largely retained by AXA Hong Kong.