CDOs

The Securities and Exchange Commission (SEC) has charged Goldman Sachs and one of its vice presidents for defrauding investors by misstating and omitting key facts about a synthetic CDO backed by subprime mortgages.

Good things, it seems come in threes, with three new CLOs in the works. Orix, Apollo Management and GSO Blackstone are arranging the three CLOs, sources said.

Investors selected Prudential Fixed Income to serve as replacement manager for two CLOs: GSC European CDO III SA and GSC European CDO IV SA.

European public CLO issuance has declined to virtually zero from more than €80 billion ($108 billion) in 2007 and Unicredit analysts said there is no progress by way of revitalizing issuance.

Citigroup has priced a $525 million CLO, upsized from $500 million, that will be managed by an affiliate of WCAS Fraser Sullivan Investment Management.

According to Fitch Ratings, 32 corporate synthetic CDO tranches will default following the recent ISDA ruling which called a credit event on Ambac Assurance Corporation.

While the CLO market still struggles to get back on its feet, the bank loan retail mutual fund market appears to be off and running.

Societe Generale Corporate & Investment Banking (SG CIB) appointed Naseem Haffar as its U.S. head of loan sales and trading.

Deerfield Capital agreed to buy $1.8 billion in CLO contracts in a deal to acquire an investment manager specializing in leveraged loan credit products, the Chicago-based asset manager announced today.

Earlier this week, Citigroup underwrote a new $500 million CLO, ending a year-long drought that saw no new vehicles consisting of widely syndicated loans.

Citigroup has underwritten $500 million for a new CLO that will be managed by FS COA Management, an affiliate of Fraser Sullivan Investment Management. And the CLO could price this week, according to Bloomberg.

New York-based Cohen & Co. has hired veteran fixed income sales executive David Clifford as its national sales manager for fixed income.

Standard & Poor's lowered its ratings on 29 tranches from nine U.S. CDO of ABS deals as well as removed 12 of these ratings from CreditWatch negative.

Babson Capital Management closed five CLOs with over $1.7 billion under management. Included in the transaction are Victoria Falls CLO, Diamond Lake CLO, Clear Lake CLO, Summit Lake CLO, and St. James River CLO.

Standard & Poor’s would like input from loan market participants on a proposed metric that would estimate a CLO’s recovery value.

At the onset of the credit crisis, market participants expected a wave of consolidation in the CLO market. The wave turned out to be little more than a ripple, with less than 5% of the CLO market making management changes during the last year and a half, according to analysts at Citigroup Global Markets.

CLO managers don't want the exit doors closed on them.

Euromax IV MBS S.A. (Euromax IV) triggered an event of default following a breach of its event of default overcollateralization ratio trigger. It’s likely to be the first of several European collateralized debt obligations to experience event of defaults triggered by a similar situation, Fitch Ratings said.

BNP Paribas appointed Giovanni Pini as head of ABS strategy and Olivier Morand-Duval as European head of ABS trading. Perry Inglis also joined as head of ABS valuation and origination.

Highland Capital Management, which last week returned investments and closed its CLO Value Fund I, is preparing to kick off another similar fund, according to a source familiar with the matter.