The $12.9 billion in CLOs issued in November pushed the 2017 year-to-date total within range of the all-time annual record, reached in 2014.
The 21 collateralized loan ogligaions printed last month pushed the 11-month total to $108 billion, “just trailing” the record 2014 volume of $124 billion, according to Thomson Reuters LPC.
Year-to-date issuance has already passed 2016's full-year tally of $72.4 billion market, and now exceeds the $98.5 billion in deal output from 2015 - previously was the second busiest year.
But November was only the second-busiest month in 2017, behind the nearly $15 billion in new deals issued in June.
Spreads also continued to tighten, with AAA coupons averaging 116 basis points over Libor in November – one of the narrowest spreads since the financial crisis.
The lowest coupons for the month were GSO Blackstone/s Long Point Park CLO 2017-1 at 107 basis points; OHA Credit Partners XV at 11 basis points and both Galaxy CLO XXIV and Dryden 53 Senior Loan Fund at 112 basis points.
The CLO market benefited from a similarly robust month for leveraged lending, with $118 billion in new and refinanced broadly syndicated institutional loans being issued. That was the highest volume month of the year, and continues a busy fourth-quarter period that has brought year-to-date loan volume to $1.22 trillion, a 59% surge over the same period last year.
Institutional volume is $817 billion year-to-date. One-third of the new-money institutional value was for leveraged buyout activity, Thomson Reuters reports.
Most of the deals involved refinancings of existing loans, as companies have taken advantage of low coupon rates to shave debt costs. Over $818 billion of the volume this year is for refis, with $402 billion in new loan issuance.
With CLOs, refinancings and resets also account for the bulk of activity, despite a month-to-month decline in November to just $6.1 billion in resets and $3 billion in refinancings. Year-to-date, reset volume stands at $53 billion and refinancing at $98 billion.
Assets under management in CLOs is now $491 billion.
Among CLO holdings, Dell International has lost its prior standing as the most widely held debt in CLO portfolios. Dell’s CLO-held debt dropped nearly $400 million to $2.75 billion from $3.13 billion, a month after it refinanced a $5 billion term loan B and reduced its size to $4.79 billion, according to KDP Advisors.
Asurion Corp. now has the most aggregate debt in CLOs with $2.95 billion, up slightly from $2.85 billion in October.
Citigroup remains atop the arranger table for new-issue CLOs, leading 26 deals with a volume of $16.12 billion to hold on to a 15% market share. Morgan Stanley arranged 20 deals totaling $12.08 billion, and Bank of America Merrill Lynch was third with 18 deals adding up to $11.6 billion.
Citi also has arranged the most resets (25 deals, $12.8 billion), and the second-most number of refinancings (31 deals totaling $14.14 billion) behind Morgan Stanley’s arrangement of 43 refinancings totaling $18.9 billion.
In Europe, CLO new-issue volume jumped to €4.7 billion in November, taking YTD volume to €18 billion across 45 deals. Of that, €1.2 billion was in refi/reset activity, bringing a combined €23.7B to YTD volume.
Citi is the lead arranger of new-issue CLOs in Europe, with nine deals totaling €3.7 billion for a 20.2% market share. Barclays is second with eight deals adding up to €3.43 billion.
