CVC listed credit fund 'pre-emptively' sheds covid-19 related positions
CVC Credit has taken a conservative approach to addressing covid-19 volatility in its listed opportunistic credit fund, with the fund divesting several credit positions to manage risk 

Time on side of direct lenders as private loans give relief against volatility
Some credit fund managers have become myopic in an effort to absorb the impact of the market sell-off, rate changes, shortage of liquidity and the overarching consequences of the coronavirus pandemic. Mid-sized companies might be considered more vulnerable in such circumstances, but direct lenders are spared from any mark to market volatility

Loan index drops below 90 for first time since February 2016
The S&P/LSTA leveraged loan index dropped below 90 today as the coronavirus pandemic continues to wreak havoc on the world's financial markets

Direct lenders face ebitda-add back language challenges as borrowers seek flexibility

Solus shutters flagship distressed fund, WSJ reports
Solus Alternative Asset Management has shuttered its flagship distressed debt fund, Sola, as the firm faces big redemption requests and coronavirus-related liquidity issues

Beneath the triple C: mighty CLO buckets from Akorns grow
Rating agencies went on a downgrading spree in February, with Moody’s and Standard & Poor’s cutting 20 corporate names to triple C or below – affecting $2.78 billion of paper in US CLOs and €316.6 million in European CLOs. 

Dutch VAT ruling to reduce impacted CLO equity returns by 1 to 2%, says BofA
The Dutch tax authority’s decision to charge a 21% VAT on CLO collateral management fees will have a ‘substantial’ impact on equity, with returns likely to be 1 to 1.2% lower going forward, according to a research paper published by Bank of America

US CLO exposure to oil and gas is 2.6%, finds Barclays
Oil and gas exposure in CLOs is fairly limited, according to Barclays research, as crude oil prices drop to $33 per barrel, down from $41 on Friday

Bluestem bankruptcy hits $106 million of CLOs
CLOs hold $105.7 million of the debt of US retailer Bluestem which filed for Chapter 11 bankruptcy last week, according to the latest trustee reports from CLO-i. 

European mid market CLO suffers blip as borrower misses interest payment
Alhambra SME Funding 2019-1 – the first middle market European CLO since the financial crisis – has suffered a setback with one of its portfolio companies missing an interest payment last month

Private credit is not overcrowded — there is four times as much private equity dry powder
With much negative reporting around private credit, our columnist debunks oft-heard complaints

Making arb work of it

Credit managers hunker down as idiosyncratic risks persist
A slew of earnings reports from credit managers and business development companies shows that deal-making and performance are robust, but great importance is being placed on credit selection.

Distressed exchanges offer pathways to recapture value that others are trying to take from CLOs
Volcker rule amendments could protect CLOs from losing out to distressed funds in a restructuring

Dispersion tests hedge fund managers

"We can have a positive impact by bringing diverse thinking to our business"
Edwin Wilches of PGIM takes our credit quiz

Past returns: Seven-year wait for equity payment
Five years ago we reported that equity investors in three legacy PGIM CLOs received a total of €1.1 million in distributions — seven years late. 

CLO managers don’t always prioritise profits

No hedges, but no problem for optimistic CLO investors
CLOs are prone to idiosyncratic risks, but investors have told Creditflux that they are confident about performance in 2020, despite the lack of hedging options. The general consensus is that some deals will suffer, but the vast majority will deliver after a disappointing end to 2019 for junior debt.

Credit funds at a glance
A round-up of fundraising and people moves in credit

Fund performance: CLO funds pick up where they left off
A round-up of fund performance

Ucits at a glance: Ucits start year on high note
A round-up of ucits fund performance

Fortress digests CraftWorks bankruptcy
CraftWorks Holdings filed for Chapter 11 bankruptcy yesterday, with Fortress Investments holding all of the Tennessee restaurant operator's first lien debt - of which over half is in middle market CLOs. The New York-based firm has submitted a “stalking horse” bid to buy CraftWorks' assets

Weak loan collateral will dent private credit returns, says Finnish pension
Valtion Elakerahasto, the state pension fund of Finland, says non-existing or weaker loan collateral has raised concerns about the returns private credit funds will generate in the coming years  

CLOs show coronavirus resistance even as bonds and loans suffer
CLO managers are - so far - looking defensively positioned in relation to the coronavirus outbreak, with only two of the five largest portfolio sectors listed as very negative in latest Wells Fargo research. But investor fears have all but closed the loan and bond primary pipeline, while lower rates signalled by the US Federal Reserve could spell a fall in leveraged loan and CLO demand