CLOs offer Asia investors appeal (and some peril)
Investors in the region are increasingly seeking out securitisations in an effort to gain more yield on their debt investments. In some cases this is causing the risks of these assets to rise.
Asia’s institutional investors are increasingly keen to get into private debt, in particular collateralised loan obligations (CLOs). But while this field looks set to grow, along with institutional investor demand, it could offer aspiring investors challenges, not least of which is falling yields and loosening covenants.
Experts say large institutional investors from Asia such as sovereign wealth funds and banks have lapped up new CLO issuances in the US, the largest market for s…
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