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Analysis CLOs
Six months of records and turmoil at the top
by Shant Fabricatorian
The first half of 2025 saw convulsions in the US economy and Golub setting a record with a huge reset. Meanwhile, Blackstone slipped to third in overall issuance, despite winning out in US BSL
The global CLO market showcased a standout first half of 2025, staying on track for a record issuance year and overcoming the bout of intense volatility induced by US President Donald Trump, as well as geopolitical conflicts. But the benign environment has led to a worsening of the CLO arbitrage, which may slow deal activity for the second half, while recent US employment data has forecasters worrying about a cloudier economic outlook.
For the first half of the year, total issuance across US BSL, mid-market and European CLOs totalled just under USD 282bn. That was an increase of USD 34.3bn on the equivalent period in 2024 (a jump of 13.9%).
Global CLO issuance, 1H 2025 ($bn)
Source: Creditflux
The market made an exceptional start to 2025, with a flying run-in to the first two months following a particularly strong close to 2024. January and February saw, respectively, spikes of 151.7% and 57.9% in monthly CLO issuance compared to the equivalent periods last year.
Then came 2 April — so-called ‘Liberation Day’ — when the US announced stiff tariffs on trading partners. Issuance slowed in the US and deal activity shuttered for a three-week period in Europe. The latter region also suffered the additional headwind of hastily-announced new guidance on risk retention from its regulators. Europe saw total issuance for that month fall year-on-year by over 58%.
2.32
bn
$
Golub priced the largest ever CLO transaction on 27 March
In line with broader financial markets, which began to shrug off Trump’s pronouncements as TACO (Trump Always Chickens Out), CLOs have stabilised in terms of spreads and deals have generally recovered to a normal level. Nonetheless, global May and June issuance experienced declines from the same period in 2024.
European issuance, in particular, showed relatively slower recovery from the April volatility than the US, despite global investors looking to Europe as they seek geographical diversification.
Golub’s record breaking prints
From a global issuance perspective, the major story was Golub emerging as the clear number one. Partly, this reflects the impact of the two largest CLO prints ever. Both were resets: the first valued at a record-smashing USD 2.32bn, the other at USD 2.30bn.
These deals, along with a consistent schedule of issuance across the first six months, helped Golub tally just over USD 12bn in total issuance, and entrenched its leadership in mid-market CLOs.
Overall, Apollo emerged as the second-largest issuer, underpinned by its clear lead in Europe. The manager secured second place even without counting the contribution of a couple of deals from Irradiant Partners, which it acquired in February.
The global leader at the end of 2024, Blackstone, claimed market leadership in US BSL issuance from UBS, but had dropped to third overall globally at the end of June, with just under USD 9.5bn of total issuance. However, it should be noted that the manager had a particularly prolific July, with six deals pricing, so the race for the year-end leader is far from decided.
UBS plummets in BSL ranking
Last year’s US BSL market leader, UBS, dropped notably to 13th place at the halfway mark of the year.
Slightly further down the rankings, AGL was a big mover upwards. It rose six spots to 22nd overall globally, up from 28th at the end of last year, and third in US BSL issuance. Underpinned by a wave of pricings, the manager more than doubled the number of deals it issued compared to the first half of last year, building on a wave of momentum it had established in the second half of 2024.
Total issuance 1H 2025, top 5 arrangers ($bn)
Source: Creditflux
Bank of America rises above JPMorgan
On the arranger side, Bank of America has moved to re-establish itself as the leading arranger globally, displacing JPMorgan from the top of the pile. BofA ended June comfortably in front of the pack, almost USD 11bn in total issuance ahead of second-placed Citi.
By contrast, JPMorgan fell from the top rank to fourth in the table by the end of June, reflecting the impact of the departure of a raft of its CLO arranging leadership to SMBC Nikko last year. For now, SMBC Nikko remains a small player, having arranged just under USD 2bn worth of deals over the first half of the year.
282
bn
$
Total global CLO issuance in the first half of 2025
Leaders hold on in counsel rankings
Milbank extended its lead at the top of the global manager counsel rankings, pricing three times the number of deals of second-placed Latham & Watkins, which rose to second place at the expense of Dechert. Paul Hastings meanwhile remained the dominant market leader for arranger counsels, ahead of Cadwalader and A&O Shearman.
Still on track for a record year?
While market sentiment remains upbeat, recent dramatic revisions of US employment figures have given investors some pause.
The CLO arbitrage is also worsening, driven by the wave of repricing of leveraged loans that has pushed asset spreads lower. A lack of new loan supply — the April volatility squashed M&A and LBO negotiations, and most have failed to resume — has been the main culprit.
Issuance in the second quarter of the year benefited from managers and investors keen to price deals in advance of any prospective heightened volatility. President Trump has announced raised tariffs on key trading partners including Canada and Brazil, while politicians and economists have heavily criticised the firing of the commissioner of the Bureau of Labor Statistics, Erika McEntarfer, after a July jobs report came in below expectations. So while CLO technicals remain strong, the unpredictability of economic policy in the US means that the second half of the year is not certain to deliver the record issuance that had seemed likely.
Methodology
- All data used for these rankings is as of 30 June 2025.
- Our issuance totals exclude double-counting due to jointly arranged deals. In jointly arranged deals, credit is split between the lead and co-arranger.
- For queries and corrections please contact data@creditflux.com.
