Broadly syndicated loans*

Robert Reynolds

Managing Director, Head of CLOs

Sally Tankard

Director, Credit, CLOs

Pending FCA approval, Pemberton’s new Collateralized loan obligations (‘CLOs’) strategy will invest in publicly rated, broadly syndicated loans which are typically used to fund sponsor driven or corporate M&A activity*. Such loans are originated by major arranging banks and held by various market participants. They are also tradeable and there is an active secondary market.

The CLO investment philosophy is predicated on the construction of highly diversified credit portfolios utilising fundamental analysis techniques and adopting a relative value approach. As the underlying loans are inherently more liquid than other credit products, this means that the CLOs are generally actively managed.

We believe that CLOs are a compelling investment for the following reasons:

  • Diversified portfolios
  • Choice of rated notes
  • Credit enhancement
  • Additional liquidity
  • Strong relative value
  • Low correlation
  • Current yield
  • Contractual returns
  • Floating rate
  • Low duration risk
  • Limited migration
  • Regular reporting
  • Full transparency

The CLO Strategy complements Pemberton’s direct lending and working capital finance strategies, offering investors access to yet another credit product to suit their investment and allocation needs.

Consistent with Pemberton’s ethical principles, Pemberton CLOs will incorporate the latest thinking in sustainable investment policies.

The strategy is headed by Dr Rob Reynolds who who brings over 15 years of experience in the European Leverage Loan and CLO markets.

 

*Subject to FCA UK regulatory approval for investment management activity.

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