Listen to the latest episode of Credit Exchange with Lisa Lee
Published in London & New York
10 Queen Street Place, London
1345 Avenue of the Americas, New York
Creditflux is an
company
© Creditflux Ltd 2026. All rights reserved. Available by subscription only.
News Analysis
SMBC challenges CLO giants for coveted top-five status
by Lisa Fu
Some of the world’s biggest names in investment banking may need to watch their backs when it comes to arranging collateralised loan obligations (CLOs). A Japanese challenger is racing up the rankings, aiming to become a top player in the market.
Sumitomo Mitsui Banking Corp (SMBC) may be a giant of Japanese finance, with centuries of expertise behind it, but the group is a relative upstart in the US-dominated world of CLOs, a form of structured credit in which corporate loans are pooled and repackaged as debt securities.
Through its securities arm SMBC Nikko, Japan’s second-biggest banking group has been making a series of high-profile hires to scale up its CLO operations.
The move reflects the need to offer a one-stop shop of credit options for clients, according to Anusha Joly, head of securitised products syndicate and co-head of CLO originations at SMBC Nikko Securities America. “SMBC has deep expertise across the credit spectrum, and CLOs are an important part of a broader platform that allows us to support clients across markets, products and geographies,” she told Creditflux.
CLOs are an important part of a broader platform that allows us to support clients across markets
Anusha Joly
Head of securitised products
SMBC Nikko Securities America
Disruptor status
The results have been rapid, earning SMBC disruptor status in the business of top-tier CLO deals, long dominated by a handful of US investment banks. In just a few years the bank has sprinted up the Creditflux league tables, which covers structuring, financing and selling the instruments to investors.
At the end of 2024, SMBC held a lowly 24th place for US CLOs backed by broadly syndicated loans (BSLs) to large companies, with deals amounting to just USD 0.35bn. A year later it cracked the top 20, earning 19th place with USD 6.43bn, giving it a market share of around 1.48%. The Japanese banking group has now vaulted to the ninth spot after organising USD 11.6bn worth of CLOs in the seven months to end-July, behind long-standing leaders.
Over the last three years, Bank of America, Citi, Morgan Stanley and JPMorgan have made it into the top five for US BSL CLOs. Still, SMBC is not content with its progress so far, seeing an opportunity to capitalise on its advantage as an early lender to the private credit community and its links with Japanese clients. “In capital markets, we want to emulate the success we’ve had in other areas like private debt and ultimately become a top-five arranger in CLOs,” Mussie Tizazu, co-head of CLO origination and head of CLO financing, told Creditflux.
International talent
The US campaign began in earnest in 2024, when SMBC poached three of the best known CLO bankers — Joly, Tizazu and Christine Ferris — from number one arranger JPMorgan. The recruitment drive was part of broader plans to attract international talent to better cross-sell products across the global business.
Expansion plans
Three years earlier, Scott Ashby, president for SMBC Nikko Securities America and co-head of coverage and capital markets in the Americas, joined the firm with a mandate to expand its investment banking business. The effort accelerated with the hiring of another former Morgan Stanley banker, Paul Burke, to develop a platform combining capital solutions and securitised products.
Other banks have tried but struggled to crack the top tier of CLO arranging, and SMBC is up against entrants such as Santander, CIBC and Scotiabank. CLO managers can be leery of trying out new shops that lack well-developed distribution networks or robust leveraged loan teams. Banks dangle sweeteners such as purchasing a big chunk of the CLO liabilities. New arrangers often buy USD 100m to USD 150m of triple As, and smaller chunks of lower-rated tranches.
For SMBC, a thriving CLO operation offers a way to expand services for existing clients and bring in new business. With 20-30% of top-rated CLOs going to Japanese investors in any given year, the Japanese distribution channel offers an opportunity for SMBC to deepen and expand its franchise, Joly said.
With global growth in mind, SMBC has cast its hiring net across regions, recruiting 15 CLO structuring hires and six staff in securitised products syndicate teams since late 2024. The signature hires include Takashi Tamiya, leading global securitised products syndication to investors in Japan, Adrian Luput, in charge of lender finance out of London for the EMEA region, and Risa Itoshima, heading up European CLO structuring.
Battle stations
SMBC is rapidly building out a global team and has already jumped up the ranks, but the real battle may just be starting.
“CLO arranging is a hyper-competitive business,” said Dan Ezra, founder and CEO of Entegra, a financial services firm offering trading-as-a-service to banks. “Banks have moved up the tables before, and a firm that commits capital and hires the right people can get into the top 10 relatively quickly. The harder part is staying there.”
