Biggest CLO Buyer Plots Return, Joining BofA and Pimco in Market
- Swelling investor base sending CLOs into record supply frenzy
- JPMorgan, Wells Fargo, PNC also buying more of the securities
Norinchukin Bank headquarters in Tokyo.
Photographer: Tomohiro Ohsumi/Bloomberg
Many of the biggest whales in collateralized loan obligations are returning to the $900 billion market after spending much of last year on the sidelines, a shift that could make one of Wall Street’s biggest credit machines run even hotter.
Japan’s Norinchukin Bank, formerly the biggest buyer in the CLO market, has begun looking at deals again, according to people with knowledge of the matter. Wells Fargo & Co., absent for much of 2020, is back. Fidelity Investments has already upped its holdings in pursuit of higher yields. And Bank of America Corp., previously just an occasional buyer in the market, has purchased billions of dollars of the bonds and plans to add more.