CLOs

The firm will invest in loans in health care, real estate, equipment and transportation, as well as corporate sectors backed by contractual cash flows, according to a statement Tuesday.

Kroll's $2 million settlement with the SEC over failing to adhere to credit-rating standards for CMBS and CLO bonds are fueling concerns that rosy credit grades are masking deeper structural problems with the securities exposed by COVID-19 related stresses, say critics.

The Charlotte, N.C., company recently closed on a sale of its Cohen Financial platform to SitusAMC.

Banks may be protected from a direct hit, but they have invested in vehicles that include such loans, potentially exposing them to defaults.

The $458.87 million HalseyPoint CLO1, via JPMorgan, is the first deal by the firm that was launched in May 2018 by two former Columbia Asset Management portfolio managers.

Historically, rising interest rates have enabled banks to earn more, but this time around in the banking industry, like much else, things are a little different.

An industry working group might seek legislation to eliminate the need for investor consent in the shift to a new benchmark interest rate. But any legislative fix is almost certain to be challenged because choosing an alternative to Libor will inevitably favor one party in a transaction over another.

The Structured Finance Industry Group wants Treasury and the IRS to issue a notice that a change from Libor to an alternative index would not be treated as a taxable exchange.

Unusually for a debut transaction, the $329.7 million M360 2018-CRE1 will be actively managed: For the first 12 months after the closing date, funds from repaid principal can be used to purchase new loans, subject to eligibility criteria.

Nonbanks are originating more commercial mortgages on fixer-uppers in response to a sharp drop in the cost of funding in the securitization market. These deals are said to be "vastly different" than other CRE instruments that sustained big losses in the crisis — so far.

The deal is backed by an unusually concentrated portfolio of just 19 loans on properties being rehabbed or converted to a new use; by property type, the biggest exposure is to hospitality, at 19.7%.

The deal, BXMT 2017-FL1 weighs in at $1 billion, making it more than twice as large as most CRE-CLOs issued this year; its size isn't the only unusual feature, however.

Benefit Street Partners is securitizing 20 short-term commercial real estate loans it originated or acquired for transitional properties currently with unstable cash flow.

The family-owned real estate group affiliate has committed a significant amount of capital to growing the finance and investment side of the organization, which includes balance sheet lending.

It’s not clear whether syndicated credit agreements require 100% investor consent before adopting a new benchmark. The industry trade group suggests giving new loans the flexibility to change indexes without unanimous approval, but investor advocates are balking.

So-called transitional lending has traditionally been kept on balance sheet; but it’s become attractive to bundle the loans for transactions called (take a deep breath) commercial real estate collateralized loan obligations. Can investors stomach the features these deals sported before the crisis?

With risk premiums on collateralized loan obligations at or near their tightest levels since the financial crisis, there may be nowhere to go but out, according to Wells Fargo Securities.

The Trump Administration’s anti-regulatory agenda has yet to permeate the Securities and Exchange Commission, which remains opposed to relief for collateralized loan obligations.

The Loan Syndications and Trading Association is appealing directly to Treasury Secretary Steven Mnuchin to exempt collateralized loan obligation managers from rules requiring "skin in the game" of deals.

Some are wording the language of amendments used to refinance deals so as to be able to benefit if risk retention rules are repealed.