Asset managers are scurrying to bring new CLOs to the market to capitalize on the healthy appetite for the structured product while a previous generation of CLOs is winding down.

Equity holders are electing to call older vintage deals, in part, because some are seeing their returns squeezed by tightening spreads in the leveraged loan market. They would often rather reinvest the capital in new deals. And for the CLOs that can no longer invest in new deals, the rapid rate of loan repayments has depleted the number of loans left in CLO portfolios.

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