First Brands Puts $2.2 Billion of US CLOs at Risk, Barclays Says

CLOs hold approximately $2.2 billion in USD and €0.5 billion of First Brands exposure, or roughly 0.2% of both the US and EU broadly syndicated loan (BSL) CLO markets, Barclays analyst Gavin Zhu writes in a research note.

• Barclays acknowledges the current data (which come from monthly trustee reports) are unlikely to reflect recent activity since downgrades began on Sept. 22
• First Brands filed for Chapter 11 bankruptcy on Sept. 29 with its $6 billion of debt losing almost half its face value over the course of a few days
• “If we look at individual reinvesting deals, in the US, ...