Och-Ziff, PGIM price CLOs; new issue spreads tighten; secondary spreads hold firm

By Cristal Cody

Tupelo, Miss., Feb. 5 – CLO issuance continues to pick up, while spreads are tightening in the primary market.

Year to date, $7.7 billion of broadly syndicated and middle-market CLOs have priced, according to a BofA Merrill Lynch research note released on Monday.

Details also emerged on two new transactions.

Och-Ziff Loan Management LP affiliate OZ CLO Management LLC priced a $509.2 million new CLO.

Prudential Investment Management, Inc.’s asset management business, PGIM, Inc., tapped the primary market with a $423.09 million CLO offering.

“With one month in the books for 2018, U.S. CLO issuance is strong, and senior spreads have tightened,” according to a Wells Fargo Securities LLC analyst note released on Monday. “January saw 10 U.S. CLOs price, for more than $6 billion in volume.”

New issue AAA CLO spreads have tightened about 8 basis points to 9 bps from the end of 2017, according to the note.

In addition, CLO secondary spreads are holding firm, ending Friday unchanged on the week, BofA Merrill Lynch analysts said.

CLO AAA secondary spreads were flat at the Libor plus 93 bps area.

Secondary spreads tightened over the first month of the year by 7 bps at the AAA level, 10 bps for single A CLOs and 25 bps to 35 bps for BBB to B levels, according to the note.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.