How do CLO managers balance risk and return while maintaining portfolio quality standards? In the latest article in our CLO Insights Series, produced in association with Weil, Gotshal & Manges (London) LLP, we provide an analysis of Collateral Quality Tests and the matrices that guide CLO portfolio management. The piece breaks down five essential quality […]
What is a CLO waterfall and what does it do? The “waterfall” is one of the more colourful phrases used by the CLO community. Formally called “Priorities of Payments”, this mechanism controls how interest and principal proceeds flow from CLO assets to investors. Our latest CLO Insights breaks down exactly how these waterfalls operate, and […]
CLO structures incorporate mechanisms designed to protect investors across varying credit environments. Historical performance data from Standard & Poor's confirms negligible defaults across multiple stress periods, from the 2008-09 crisis through the recent inflation cycle.
The Standard of Care is central to CLO management. In the second edition of our CLO Insights Series, we examine its practical impact on managers’ responsibilities. The principle is straightforward but important: CLO Managers must manage capital with the same level of skill and attention they apply to comparable assets across their business. Reasonable care […]
Par value is the cornerstone of CLO structures, shaping investor protections and serving as a key measure of a manager’s skill. The first edition of our CLO Insights Series explores the central role of par value with a focus on: For institutional investors, understanding par value dynamics is essential for CLO evaluation and manager selection. […]
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