CLOs can survive defaults, but it could be death by triple Cs

By Hugh Minch

Covenant deterioration in the leveraged loan market has caused sleepless nights for CLO managers who worry that when defaults start to rise, recovery rates will be lower than in past downturns. But market participants are expressing concern that ratings, rather than defaults, pose a greater risk to the market

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TAGS: Performance North America Leveraged loans Distressed debt CLO