Our Founding Partner, Alberto Thomas, has been quoted in a Creditflux article on the outlook for the CLO market. In the article, he warns that “CLO managers and investors think everything will get better because they’ve seen a recovery in the financial markets. Markets are not reflecting the reality of the economy – the Fed and the European Central Bank can’t bail out every leveraged loan issuer.”
He also makes the point that we will get a good picture at the June payment date of what is in store for many CLOs. “you breach your over-collateralisation test, you’re never getting it back again.”
You can read the article in full here.