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Saturday, 20th April 2024 |
| Collateralised debt obligations (CDOs) |
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| An asset backed security which uses a portfolio of bonds or loans as collateral, or security. This year Bank of Ireland issued the first fully Irish structured CDO. |
AIB Acquisition Finance (Galway Bay BV)
Date launched: September 2003
Volume: €407 million
Manager: Morgan Stanley
Investment Adviser: AIB Acquisition Finance
Legal Adviser to AIB: Herbert Smith
Description: This is AIB’s third CDO, following on from Clare Island BV a €364 million CDO in 2002 and Tara Hill, a €447 million CDO in 2001, and positions AIB as one of the top collateral managers in Europe, having issued over €1.2 billion in CDOs in the past number of years. Galway Bay BV will invest in leveraged loans to a pool of middle to large sized private equity backed European borrowers across a diversified range of industries.
Avoca Capital (Avoca CLO I BV)
Date launched: 25/11/03
Date closed: 16/12/03
Volume: €304 million
Maturity: 16/11/16
Coupon: 53bp over Euribor (AAA)
Manager: Deutsche Bank
Legal Adviser: Ashurst
Description: Avoca, run by a team of former AIB Acquisition Finance employees, pooled senior secured loan (80%) and mezzanine loans. The Dutch spv will issue tranches rated from triple-A to double –B.
Bank of Ireland (Partholon CDO 1 plc)
Date launched: 19/09/03
Date closed: 6/10/03
Volume: €410 million
Arranger: Bank of Ireland Asset Finance
Dealer: JP Morgan
Irish legal adviser: A&L Goodbody
US legal adviser: White & Case
UK legal adviser: White & Case, Ashurst Morris Crisp
Description: A collateralised loan obligation transaction. Loans originated by Bank of Ireland, with Bank of Ireland acting as investment manager. This was the first ever-public CDO with an Irish issuer special purpose vehicle. Furthermore, the transaction was the first CLO originated by, and advised by Bank of Ireland, and involved a highly innovative tax structure.
Harbourmaster Capital (Anchor 1)
Volume: €1 billion, €30 million, €5 million
Maturity: 2009
Coupon: 50bp over Euribor, 80bp, 125 bp
Rating: AAA, AAA/AA+, BBB
Arranger: Bank of America
Description: Uses a novel tranching structure to draw senior investors looking for a lower risk profile. The lowest €100 million of the super senior risk was carved into a funded note rated AAA by Fitch and Standard & Poors.
Zais Group Investment Advisers (Euro Zing II)
Date launched: 14/08/03
Date closed: 08/03
Volume: €287.5 million
Maturity: 2/07/43
Ratings: BBB
Arranger: JP Morgan
Description: JP Morgan launched the second cash collateralised debt obligation of European stet backed securities for Zais Group Investment Adviser. It parcelled mostly mezzanine tranches of ABS with an average rating of triple B. It was roughly 60% ramped at launch. A five-year reinvestment period follows when up to 25% of the pool may be substituted per year. It is a limited liability Dutch spv. The proceeds will be used to purchase a diversified portfolio of European structured finance collateral.
Zais Group Investment Advisers (High Tide)
Date launched: 05/03
Volume: €1 billion
Arranger: Citigroup |
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| Article appeared in the February 2004 issue.
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