Although unconventional, the setup can be effective, as demonstrated by Rockford Tower Capital Management. The CLO manager was crowned Creditflux Manager of the Year in July and its global head of CLOs is based in New York.

Another factor in Palmer Square’s favour is that, for the best part of six months, working away from the office has become commonplace. This has underlined that working virtually — or at least away from centralised locations — is not perhaps as important as was thought.

“Investors have been tremendously supportive of our build-out strategy because we have prioritised replicating the exact same risk culture we have for our US CLOs,” says Long. This, he argues, means that Palmer Square’s US CLO track record can be more directly applicable to European CLOs than it would be if the firm was hiring an experienced European CLO portfolio manager to run the business.

In March, Barclays research found that Palmer Square was the CLO manager best placed to weather a barrage of corporate credit downgrades.

Palmer Square analyst Theo Stamos is set to spend the first few months of next year in London to ensure that Palmer Square’s philosophy — which includes buying large, liquid loans — is impressed upon the European team. Once the bedding in period is complete he will spend up to two weeks of every month in the city.

Long says that the seeds for Palmer Square’s European expansion were sewn in 2015 when it started hiring officials with European credit experience to its Kansas headquarters.

Jon Brager joined as portfolio manager that year after leaving Hermes Investment Management in London and he will serve as portfolio manager on the European CLO platform.

Stamos left London in 2018 to join Palmer Square from Goldman Sachs, and trader Michael Moore also relocated from London to Kansas City in 2018 after leaving Brigade Capital Management.

Palmer Square priced its first European CLO on 21 August in a €198.1 million transaction.