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US CLO Issuance Hits Record Volume, Topping $125B

CLO issuance

CLO issuance in the U.S. in 2018 has topped $125 billion, officially eclipsing the all-time record of $124.1 billion set in 2014.

The recent activity raises the total size of the CLO market in the U.S. to $600 billion, according to J.P. Morgan, which projects the market to grow to $700 billion by the end of 2019, after expected net issuance of $100 million next year, taking into account maturing CLOs and loans that are paid down.

To be sure, the CLO market has accelerated in recent years, and following the financial crisis. The total outstanding at the end of 2014 was $350 billion. The pre-crisis peak was $256 billion in September 2008.

Collateralized loan obligation vehicles are an essential component of the U.S. leveraged loan investor base, snapping up roughly 60% of credits offered to institutional investors. – Andrew Park

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