CLO overview

The CLO market has once again proved to be resilient in the face of regulatory headwinds as it registered its second best year on record in terms of new issuance last year. Coupled with a huge volume of refinancings and resets, all of the market participants had a very busy year. With a strong year behind us and an optimistic forecasted issuance this year, CLOs continue to demand over half of the domestic leveraged loan issuance.

As regulation continues to impact the leveraged loan and CLO markets and
their participants, new CLO asset managers and investors still continue to enter into the market. Contrary to expectations of many that the final risk-retention rules that went into effect on December 24, 2016, would shrink the market, most market participants have been able to assess, adapt, and incorporate the new rules into their business model. Furthermore, the need for third-party financing for risk retention solutions actually brought new investors and capital into the market, with demand for funding at times outpaced by supply. That said, on February 9th, the US Court of Appeals ruled that risk retention does not apply to managers of open market CLOs. While subject to appeal, at this writing it appears likely that CLO managers will have relief from complying with the risk retention rules.

Volta Finance Limited (LON:VTA) is a closed-ended limited liability company registered in Guernsey. Volta’s investment objectives are to seek to preserve capital across the credit cycle and to provide a stable stream of income to its Shareholders through dividends that it expects to distribute on a quarterly basis.

Click to view all articles for the EPIC:
Or click to view the full company profile:
Facebook
X
LinkedIn

More articles like this

Volta Finance

Unlocking investment potential with Structured Products

Structured products offer a unique blend of flexibility and strategy, making them an attractive option for investors seeking tailored solutions in today’s dynamic financial landscape. With their ability to combine capital protection, market-linked returns, and risk

Volta Finance

CLO income fund posts stellar +20.9% returns YTD (LON:VTA)

AXA IM has published the Volta Finance Limited (LON:VTA) monthly report for November 2024. The full report is attached to this release and will be available on Volta’s website shortly (www.voltafinance.com). Performance and Portfolio Activity Dear

Volta Finance

CLO ETFs remain a strong investment opportunity for 2025

Collateralised Loan Obligation (CLO) Exchange-Traded Funds (ETFs) continue to present a strong investment opportunity as we approach 2025. According to a recent poll conducted during VettaFi’s 2025 Market Outlook Symposium, CLOs were ranked highly by financial

Volta Finance

Exploring the benefits and structure of CLOs

The benefits of investing in Collateralized Loan Obligations (CLOs) for steady income and risk diversification. Learn how CLOs work and why they are a popular option for investors.

Volta Finance

CLO market set for growth in 2025

The outlook for collateralized loan obligations (CLOs) as 2025 approaches is optimistic, driven by a more favourable macroeconomic environment. According to Moody’s latest report, several key factors, including declining default rates, reduced interest rates, and stabilised