CDO tightening has by no means been limited to SF CDOs. High yield loan deals have seen remarkable reception. Talk on the triple-As for David L. Babson's pending HYL CLO was revised from Libor plus 40 to Libor plus 37 to 38. Morgan Stanley is underwriting the transaction. Several other recent HYL deals have priced below the 40 mark, including Putnam's Boston Harbor I (Lehman Brothers), Invesco's Champlain 2004-I (Wachovia Securities) and Mountain Capital's Mountain CDO III (Bear Stearns).

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