Like a tuft of grass in rocky terrain, emerging-market CDO Trabuco took hold in a difficult market late last month. Rated triple-A by both Moody's Investors Service and Standard & Poor's, the US$93 million, 12-year transaction priced at 50 basis points over Libor and is backed by a variety of emerging market bonds, loans and synthetic exposures.

"There's been a lot of difficulties getting [EM] CDOs done," said a source familiar with the deal. "It's the general market sentiment more than anything else."

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