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Global credit funds & CLO's

January 2024 | Issue 261

Published in London & New York.

Opinion

February 2024 | Issue 261

Gre tchen Lam, CEO | Octagon Credit Investors

Opinion CLOs

Rates are moving lower, which makes CLO equity look better versus loans

Randy Schwimmer,

Co-head of senior lending

Churchill Asset Management

Opinion private credit

As the economic environment evolves, investors need to change too

Thomas Majewski,

Founder & managing partner

Eagle Point Credit Management

Opinion direct lending

Private credit funds are more stable, lower levered and more regulated than you might think

Past returns

Where are they now?

Our latest set of manager rankings by AUM (see CLO rankings: 2023 turns out OK) prompted us to look back to our first league table in 2010. The top five players were: Babson Capital Management, Carlyle, Highland Capital Management, Blackstone Debt Advisors and Alcentra.

The Babson name is gone, but under its new Barings moniker it’s still in the top 20, with almost the same AUM as in 2010. Carlyle is still in second place and Blackstone has jumped to the top spot. After a few challenging changes of ownership, Alcentra is also still hanging in there, but has shrunk to about two-thirds of its 2010 size.

And Highland? We don’t talk about Highland.

Points up front

Blame it on the Bad Bunny

CLO market participants have been looking in dismay at the outrageous hotel prices for the industry’s annual trip to Las Vegas for the Structured Finance Association’s SFVegas 2024 conference.

Sadly the prices aren’t a reflection of a sudden jump in popularity of structured credit. Instead, the culprit is Puerto Rican rapper Bad Bunny, who’ll be playing at the T-Mobile Arena in Vegas the night before the conference starts.

We’re not sure what the Venn diagram of structured finance professionals and Bad Bunny fans looks like, but we hope they’ll behave beautifully at both events.

Bad Bunny: his effect on hotel prices has made some SFVegas attendees hopping mad

End of an era

Congratulations to Jay Grushkin, who retired from his practice at Milbank last month after 41 years at the firm. One of the best known lawyers in the CLO market, Grushkin led Milbank to become the most active manager counsel globally.

He leaves Milbank in the capable hands of Sean Solis, practice group leader of the firm’s alternative investments practice, and leader of its global structured credit practice.

Of course, we all know that no one ever really retires from the CLO market, and Grushkin himself gives a tantalising hint, saying on the LinkedIn announcement of his retirement: “What else lies ahead, both professionally and personally, remains to be seen. So stay tuned.”

THEY SAID IT

“Wall Street’s hopes for a CLO market revival have been crushed”

Bloomberg’s lead headline from October shows just how quickly sentiment in the CLO market can turn around.

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