October 2021 | Issue 239
Past returns
Black Diamond riles investors
10 years ago in Creditflux, we reported on lawsuits against Black Diamond Capital Management after it tried to make $45 million of trades in Black Diamond CLO 2005-1 using cash the deal hadn’t yet received.
The CLO’s senior investors Met Life and PGIM argued that the trades — which were placed just before the deal’s reinvestment window closed — should not be allowed to settle and the cash should be used to amortise the CLO’s senior debt.
A New York court found in favour of the investors and Black Diamond paid down senior debt on the next payment date. Nevertheless, in subsequent years the manager expanded its CLO business. Its last new issue CLO was in 2019.
Points up front
CLO award-winners love bowing out at the top
Reaching the summit of their profession gives CLO officials the compulsion to move on to pastures new, as evidenced by the Creditflux Manager Awards. CIFC’s European chief Dan Robinson is the latest example. A couple of weeks after picking up the award for Best New European CLO, Robinson left CIFC.
Over the years, other Creditflux award winners have left their firm within days, such as David Lerner (left CSAM for Shenkman) and Miguel Ramos (left Blackstone before going on to establish Fair Oaks).
It’s clear a Creditflux award is the pinnacle after which recipients get the urge to conquer new worlds. We just hope — given staff shortages in the industry — that this news doesn’t make managers fearful of entering next year’s awards.
Here’s to you Mr Robinson: CIFC’s European head (left) picks up his Creditflux award then decides to leave
Risk retention gets less than 5% of airtime
In a sign of how buoyant the CLO market is, risk retention was hardly mentioned at Creditflux’s CLO Symposium. Milbank partner John Goldfinch gave a self-deprecating assessment: “It’s boring for lawyers. We’re not putting out thousands of client alerts every few months… and they’re not used as sleep aids at all.”
Goldfinch did himself a disservice. His discussion with DLA Piper’s Richard Reilly was one of the most engaging panels at the symposium.
“Oh, hell no!”
PineBridge Investment portfolio manager Laila Kollmorgen tells the audience at Creditflux’s CLO Symposium that she is unequivocally against increasing triple C limits from 7.5%
Global credit funds & CLO's
October 2021 | Issue 239
Published in London & New York.
Copyright Creditflux. All rights reserved. Check our Privacy Policy and our Terms of Use.