Over four fifths of the collateralized loan obligations reporting to Standard & Poor’s have at least one asset in their underlying portfolio that is not a loan.
CLOs that own bonds and other securities run afoul of the final version of the Volcker Rule, published in December, making them off limits to banks. But to date, hard numbers on how many CLOs fall into this category have been hard to come by. In a report published today, S&P said it examined 640 of the 705 CLO transactions outstanding as of year-end 2013; the remaining 65 deals were not effective or did not begin issuing their monthly reports by that time. Of