The market for collateralized loan obligations hit an all-time high in 2014 — but the onset of a number of regulatory requirements, including the Volcker Rule, mean the good times may not last long.

Collateralized loan obligations are securities backed by pools of loans to mid- and large-sized businesses. If banks conduct good due diligence on the loans that they approve, and if investors understand the financial risks of CLOs, these instruments can inject significant liquidity into the market, enabling banks of all sizes to boost lending.

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