CSAM improves spreads in $713 million second reprint; CLO AAA spreads firm; outflows up

By Cristal Cody

Tupelo, Miss., June 7 – Credit Suisse Asset Management, LLC tightened spreads across the CLO tranches it refinanced for a second time in a $713 million offering that closed on Thursday.

The spread on the AAA-rated tranche improved by more than 20 basis points from when it was first refinanced in 2016.

At the bottom of the stack, the tranche of class E-R-2 deferrable mezzanine floating-rate notes (BB-) priced at Libor plus 640 bps, compared to where it came at Libor plus 762 bps in the 2016 refinancing transaction.

CLO refinanced AAA-rated spreads printed about 1 bp better this week in the Libor plus 111 bps area, according to a Wells Fargo Securities, LLC research report on Friday.

New issue AAAs also priced in general about 1 bp tighter on the week in the Libor plus 129 bps area.

In the secondary market, broadly syndicated CLO spreads mostly softened from a week ago.

In other activity, leveraged loan outflows “accelerated” for the week ended Wednesday, Yuri Seliger, a credit strategist with BofA Securities, said in a global research note released on Friday.

Outflows climbed to $1.24 billion from $420 million in the previous week, according to the report that cited data from EPFR Global.

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