CLO Equity Holders Reset Deals at Record Pace: Credit Weekly

Investors in the riskiest portions of collateralized loan obligations are seeing their returns get juiced thanks to the biggest wave of resetting on record.

Resets, a form of refinancing for CLOs, surged to a US record of more than $26 billion in August, according to data compiled by Citigroup Inc. that dates back to 2015. That’s a huge jump from the previous record for a month set in June, when they exceeded $20 billion for the first time.

Sales of new CLOs may soon come under pressurebecause there are too few loans to package into the securities. Even ...