Bonds News

UPDATE 1-Citigroup tops US CLO arranger league table in 2019

(Adds Citigroup declines to comment)

NEW YORK, Jan 9 (LPC) - Citigroup was the top arranger in 2019 of new US Collateralized Loan Obligations (CLOs), keeping its grasp on the lead spot it has held for at least eight years.

The bank, which had a 13% market share last year, has been atop the new-issue US CLO arranger league table every year since 2012 when Refinitiv LPC began publishing the ranking.

About US$118.7bn of US CLOs was arranged in 2019, the third largest year of volume, according to LPC Collateral data. A record US$127.7bn of deals was issued in 2017. But US CLO issuance is forecast to fall in 2020, with banks calling for between US$75bn to US$100bn of volume.

JP Morgan was the second most active new-issue arranger last year with 11% market share on US$13.2bn of volume. Wells Fargo ranked third, also with 11% share but on US$12.7bn of volume, according to the data. JP Morgan moved up from the third spot in 2018 and Wells Fargo improved from the fifth position.

Rounding out the top five was Barclays in the fourth position with 9% market share on US$10.4bn of deals and Morgan Stanley in the fifth spot with a 9% share on US$10.3bn of volume.

The league table ranks arrangers by volume and does not include CLO refinancings or resets.

“We are pleased to have increased our rankings year-over-year,” a Wells Fargo spokesperson said in an emailed statement. “This underscores our commitment to our clients and to this business.”

A JP Morgan spokesperson and a Citigroup spokesperson both declined to comment.

In the final three months of 2019, JP Morgan ranked first on the quarterly US CLO new-issue arranger league table, followed by Barclays and then Citigroup, according to LPC Collateral.

Last year saw the CLO manager universe expand, according to Wells Fargo, with 115 US managers issuing a deal, split between 93 broadly syndicated CLO managers and 22 middle market managers, according to a January 6 report from the bank. Fourteen of these issuers were new managers.

In 2020 Morgan Stanley is calling for US$75bn of broadly syndicated US CLO volume, while Barclays has forecast US$80bn-US$90bn of similar funds, according to research reports. Bank of America and Nomura are both forecasting US$80bn-US$90bn of issuance, Deutsche Bank is expecting US$90bn and JP Morgan is calling for US$90bn-US$100bn.