Private equity firm Clearwater Capital Partners last week launched the first publicly rated CLO backed by Asia ex-Japan distressed debt. The offering was small, at only $146 million, but it signifies the growth many say is overdue in the Asian credit markets outside of Japan.

While there is still a yield premium to such deals, they are becoming increasingly correlated to corporates both in Europe and the U.S., sources said, as ex-Japan Asia markets develop a higher level of sophistication.

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