...CLO Market Expands Manager Profile: With increased demand and issuance of collateralized loan obligations (CLOs), new entrants to the market are taking advantage of favorable conditions to enter a space historically dominated by large institutional firms. The CLO market has experienced a 65% growth in issuers, with 47 new managers entering during 2013 and 2014 (through October). As expected, the profile of newer entrants, in terms of size, is quite different than the "frontier" CLO 2.0 issuers of 2010 and 2011. Average firm assets under management (AuMs) of later entrants are significantly less than early issuers. Investors Focus On Downside Risk: Investors are typically focused on operational and reputational risk. Therefore, there should be a great emphasis on governance, risk management, investment processes and discipline, operational risk and sustainability. Investors should be demanding in terms of reporting and client servicing, which could be a challenge for less experienced managers...
