US and European CLO Market Reviews
Br inging You CLOser
Sculptor Capital Management
Br inging Us CLOser
Br ight wood Capital LLP AN INDUSTRY NEWSLETTER FOR THE GLOBAL CLO
Your Maples Group global CLO team provides Cayman Islands, Irish and Jersey legal advice and CLO issuer / co-issuer and fiduciary services in the Cayman Islands, Delaware, Dublin, Jersey, London, Luxembourg and the Netherlands. This edition of The CLOser1 includes
What’s Inside
The Maples Group is delighted to present our September 2025 edition of The CLOser.
In addition to our regular US and European market reviews and listings updates:
• Our Bringing You CLOser external article comes courtesy of Josh Eisenberger, Head of US CLO Management, and Michael Lin, Head of US CLO Structuring and Origination, at Sculptor Capital Management.
• Our third Bringing Us CLOser feature spotlights diversity, equity and inclusion through a meaningful discussion with Arlene Shaw, Managing Director, at Brightwood Capital LLP.
• and last, we feature members from our global CLO team.
US CLO Market Review
James Reeve Partner
Head of Cayman Islands
Structured
Finance
+1 345 814 5129
james.reeve@maples.com
In this summer 2025 edition of The CLOser, we have the privilege of bringing you the market observations and expert views of Sculptor Capital Management, through our ‘Bringing You CLOser’ Q&A with Michael Lin and Josh Eisenberger. As such, we have kept the US CLO market review brief and focussed on presentation of high-level data to help to illustrate current position year to date (“YTD”) and to place it into an historical context with comparative data for 2024 and, in some cases, earlier years. First, we will focus on data for the US CLO market as a whole and then we will turn attention specifically to data in respect of deals where the Maples Group was engaged. The Maples Group data generally covers activity in the period from 1 January 2025 through to 31 July 2025.
In terms of key market trends and developments during this period, we highlight the following, from our unique perspective as the leading international CLO service provider of choice:
• We are pleased to report that the US CLO market has now settled back on the Cayman Islands as the preferred jurisdiction for structures involving a non-US entity as CLO issuer. In addition to all new formation instructions being for Cayman Islands SPVs, existing CLOs with non-Cayman Islands issuers that were launched during the period
when the Cayman Islands was on the EU AML list are often being migrated concurrently with a reset of those deals, while those being refinanced are tending to remain in their alternative jurisdiction.
• This year has been exceptionally busy across all typical areas of activity, but notably YTD we have seen substantially more new warehouses being opened as compared to 2024 YTD and our refi and reset activity is running around 30% up on 2024 YTD, the major contributing factor being the strong start to 2025, as compared to the relatively weaker start to 2024.
Our refi and reset activity is running around 30% up on 2024 YTD
• Regarding warehouses, three trends are identifiable:
• an appreciable growth in the number of ‘open’ warehouses (at the time of writing about 25% up based on 2024);
• continued / increasing interest in permanent warehouse structures providing financing solutions to multiple warehouse lines;
• an apparent shift away from investors holding equity, in the form of preference shares, in favour of holding debt / subordinated note; and
• a slight lengthening of average warehouse durations based on analysis of closed CLOs YTD, while remaining short in historical terms.
• Appetite for stock exchange listings remains relatively stable and unchanged from 2024.
US Market Overview
The dominant theme for 2025 YTD has been the recordbreaking issuance volume thus far, bolstered by the elevated refinancing and reset activity. Despite the temporary ‘pause’ experienced in early April 2025, as the markets and CLO industry participants digested the US government’s administration tariffs and potential implications, at the time of writing in early August, CLO new issuance volume YTD stood at approximately US$122.18 billion (from 250 deals), compared to US$114.59 billion (from 243 deals) for the same period in 2024.
We can see from Figure 1 that strong performance in context, over the period since 2021.
Figure 1: New Issuance - Yearly
In Figure 2, we break down CLO new issuance volume by month, highlighting that after the relatively softer start to the year, strong issuance followed in February and March 2025, with particularly strong performance again in May and July 2025. During April 2025 there was greater volatility, some widening spreads and general ‘indigestion’ relating to the macroeconomic position and possible ramifications of the US tariff policy, but activity gradually rebounded once the extent of exposure to industry sectors most impacted, or likely to be most impacted, had been more clearly ascertained. Despite record YTD volume surpassing that observed in 2024, JPMorgan has cautioned (in July 2025) that new issuance must, of course, be offset by deal
terminations / liquidations and refi / reset / reissuance transactions – and, in fact, this meant that net new CLO supply was ‘near-anaemic’.
Whereas on the European CLO side, both new issuance and refi / reset activity were significantly and comparably impacted by ‘Liberation Day’, on the US CLO side, the impacts were more heavily visible in the refi / reset activity, as can be observed in Figure 4 – and it took a few more weeks for activity to rebound than for new issuance (c.f. Figure 4 and Figure 2). $25.00
Turning to refi and reset activity, this is presented on a yearly basis in Figure 3 (covering 2021 onwards) and monthly in Figure 4. What is particularly striking is the extent to which we have exceeded the record levels YTD in the comparable period for 2024. The excess over 2024, by volume, is around 33%, and by deal count is around 24%, with a heavier weighting towards resets, essentially breathing a ‘second-life’ into deals and extending their reinvestment period / maturity dates. At the time of writing, 2025 had approximately 250 resets representing a volume of US$129.06 billion and 146 refi transactions representing a volume of US$58.58 billion. The comparable figures for 2024 for that period being 194/US$92.86 billion and 125/ US$47.86 billion, respectively.
Figure 2: New Issuance - Monthly
Figure 3: Refi & Reset - Yearly
Figure 4: Refi & Reset - Monthly
In terms of other high-level observations, deal size started the year on a high then dropped into February 2025 through to April 2025, after which there has been a general upwards trend with average deal size hovering around the US$500 million mark in July 2025. See Figure 5.
Finally, we note a considerable degree of scatter in priceto-close periods during 2025 thus far. This does not seem surprising, given the events of the year and the sometimes volatile market conditions. The overall average period between pricing and closing sits at a little over 35 days, but it is significant that 24% or more of deals had price-toclose periods of less than 30 days, and almost 10% less than 20 days.
Figure 5: New Issuance - Deal Size
Figure 6: New Issuance - ‘Price-to-close’ Periods
Figure 6: New Issuance - ‘Price-to-close’ Periods
Maples Group Deals
The Maples Group has had the pleasure of another exceptional year thus far, with record-breaking numbers of transactions for the firm and growth in our practice, services and teams globally. We are proud of our large, longstanding team of dedicated CLO specialists, who continue to bring their immense years of collective experience, knowledge and expertise into play on every deal on which we are engaged and impart that onto our ever-expanding global team. This is something that we will be celebrating as part of our distribution of this edition of The CLOser – so look out for the videos on LinkedIn!
To supplement our aforementioned observations on data for the US market as a whole, we now turn attention to the specific deals that the Maples Group was engaged, and share our insights and observations on the main trends identified:
Overall, these are approximately on par with 2024 YTD but have exceeded 2024 levels in every month except April and May. Our strongest months so far have been February, March and June.
Figure 7: New SPV Incorporations
Warehouse activity has exceeded 2024 YTD levels. Particularly strong months for new warehouses opening were January, March, April and June, with March topping the list.
CLO closings have been comparable to 2024 YTD for us, with March and May being particularly busy.
It is quite striking to compare the first few months of 2025 with 2024. As can be seen, January through to the end of March was a very busy period, consistent with the US market as a whole. This is, of course, quite different to what we witnessed in 2024, where conditions did not become conducive until later in that period. Overall, we are around 30% up on 2024 YTD activity, although that is largely due to this difference in pattern and a particularly busy start to 2025.
Figure 8: New Warehouses ‘Opened’
Figure 9: CLO Closings
Figure 10: Refi / Reset Closings
The purpose of this chart is to amalgamate refi / reset closings, CLO closings, warehouse transactions and new incorporations to provide a sense of cumulative activity level through the year thus far. Since the end of March and beginning of April 2025, performance has remained relatively steady. April 2025 was a strong month for us, regardless of events in the US. Prior to that, however, January, February and March 2025 were, overall, our strongest months of the year.
Tracking the number of ‘open’ warehouses is an interesting metric and the actual figure and trend can be interpreted in a number of ways (e.g. significant growth may indicate confidence and a strong pipeline) can be indicative of growth in our number of instructions, or it may indicate slower progress in ramping up portfolios and marketing deals. We cannot provide a definitive answer, however we can observe that, compared to last year, we have approximately a 24% increase in the number of open warehouses in which we are engaged. In these cases, we have witnessed a slight increase in warehouse durations and a small number of warehouse amendments. This perhaps points more towards signs of headwinds in the market, but we will need to wait to see how the rest of the year unfolds. It has been reported, however, that the CLO open warehouse count is “trending higher than historical averages”.
Figure 11: CLO Activity
Figure 11: CLO Activity
Figure 12: Total 'Open' Warehouses
Figure 12: Total ‘Open’ Warehouses
[In warehouse transactions we have observed] a trend towards investors holding their ‘equity’ interest by way of contractual debt obligations/subordinated notes [...] rather than by way of ‘pure’ equity in the form of preference shares
13: Progress of YTD Warehouses
Related to the comments in respect of Figure 12 and somewhat reassuringly, the percentage of new warehouses ‘opened’ this year (where the Maples Group has been engaged) that have proceeded to a successful CLO closing is marginally up in 2025. If any headwinds were considerable, one would anticipate this percentage figure to have decreased.
Figure 14: Average % of Warehouses Issuing Pref Shares - Monthly
Figure
The issuance of preference shares in warehouse financing structures has historically tended to be seen in, very broadly, 40%-60% of warehouse transactions. Neglecting anomalies in our data for the first month of the year, Figure 14 shows that, in general, the trend for 2025 was similar to that of 2024 up until May, when we then began to see a trend towards investors holding their ‘equity’ interest by way of contractual debt obligations/subordinated notes (e.g. similar to CLO ‘equity’) rather than by way of ‘pure’ equity in the form of preference shares. From discussions with onshore counsel and other CLO industry participants, we understand that while sometimes there is a need to structure investment via preference shares (e.g. for European regulated investors), often that is not the case and structuring by way of contractual debt obligations / subordinated notes may reduce local regulatory compliance requirements. We hence attribute this emerging trend to greater recognition of those potential benefits.
Figure 16 + 17: New Issuance Stock Exchange Listings 2024 + 2025 YTD
As mentioned in respect of Figure 12, there has been a trend towards slightly longer warehouse durations through 2025 YTD (on an average straight-line basis). However, at around 5.4 months for CLOs that closed in July, this is in fact on the shorter side compared to periods reported over recent prior years.
Stock exchange listings continue to be observed on only around 18-20% of CLO transactions, with the Cayman Islands Stock Exchange (“CSX”) leading over Euronext Dublin. Figures 16 and 17 show the splits for 2024 and 2025 – there is no appreciable difference overall, but for a more fulsome analysis and review please see our CSX listings update on page 29.
2025 Market Conditions and Outlook
To date, this has been an interesting and incredibly busy year. There has been both sustained periods of favourable conditions mixed with volatility, instability and uncertainty. If spreads remain fairly tight in historical terms and/or trend favourably, barring major shortage in asset availability/ quality, it seems likely that the current trajectory towards another record-breaking year will not be derailed.
For further details, please contact:
James Reeve +1 345 814 5129 james.reeve@maples.com
Figure 15: New Issuance - Warehouse Durations
European CLO Market Review & Outlook
A Market Review and What Quarters 3 and 4 of 2025 Have in Store
The European CLO market sustained strong momentum into the first half of 2025, following a robust conclusion to 2024. Data released by Creditflux notes that the first two quarters of 2025 saw €37.74 billion in new European issuances, an increase of almost €4.7 billion compared against the same period in 2024. There has also been an increase in the level of resets and refis with total repricings this year coming to €27.78 billion, an increase of over 100% for the same period last year. European CLOs have continued to outpace other asset classes such as UK RMBS and German Auto ABS.
April 2025 saw a slowdown in new CLO issuance with total volumes falling to €1.6 billion from €4.7 billion in March 2025 in response to the significant financial markets volatility that followed the announcement of a new tariff regime by the US government on “Liberation Day”. However, May 2025 saw a rebound with a healthy pipeline of both warehouses closing and CLO’s pricing. Increased refinancing and reset activity is expected to continue as managers seek to optimise capital structures and extend reinvestment periods in anticipation of further ECB interest rate cuts in the second half of 2025 as well as uncertainty around the US tariff regime.
Market Dynamics and Deal Structures
The European market welcomed its first mid-market CLO at the end of 2024, a structure long established in the US but only now gaining traction in Europe. Midmarket CLOs have emerged as a notable feature, with several established managers exploring these products. This evolution demonstrates the market’s adaptability and appetite for innovation, as managers diversify offerings and attract new investor bases.
Investment banks continue to provide Class A loans to fund European CLOs, with multiple Class A loans being implemented in certain transactions. This trend reflects strong lender appetite for top-tier tranches and an increasingly competitive
environment among arranging banks. It is also notable that Environmental, Social and Governance (“ESG”) considerations have become more deeply embedded in CLO structuring. There has been a notable rise in ESG-labelled CLOs, with managers integrating ESG screening and reporting to meet investor demand and regulatory expectations.
Investor Base and Product Innovation
Investor interest in European CLO exchange-traded funds (“ETFs”) continues to grow, with several market participants actively exploring or planning new products. Recent months have seen increased interest in ETFs as a means to access AAA European CLO tranches. These actively managed funds offer exposure to diversified CLO portfolios and provide an attractive alternative to traditional fixedincome investments, with listings on major exchanges including the London Stock Exchange, Deutsche Börse, Euronext Milan and SIX Swiss Exchange. Notably, Palmer Square Capital Management has launched Europe’s first passively managed CLO ETF designed specifically for European institutional investors that provides exposure to AAA- and AA-rated CLO debt.
Structural innovation remains a key theme, with managers experimenting with shorter non-call periods, flexible reinvestment mechanics and sustainabilitylinked triggers. The use of synthetic tranches and bespoke structures is also increasing, catering to specific investor risk-return profiles.
First
two quarters of 2025 saw € 37.74 billion in new European issuances
Euronext Dublin GEM: New Opportunities for CLO Warehouse Listings
A notable CLO market development saw the opening of the Euronext Dublin Global Exchange Market (GEM) to CLO warehouse listings as of 1 May 2025. The new framework introduces a dedicated process for CLO warehouses, featuring reduced disclosure requirements, a bespoke checklist, consolidated AML processes, options for non-publication, fast-track processing, transparent and competitive pricing and a streamlined delisting procedure via Euronext Direct upon CLO launch. These enhancements are expected to increase listings flexibility and efficiency for managers.
Regulatory Developments
Corporate Social Reporting Directive
On 26 February 2025, the European Commission announced its first ‘omnibus simplification package’ aimed at streamlining certain EU ESG laws, including the Corporate Sustainability Reporting Directive (“CSRD”). If enacted, the proposals would significantly reduce the scope of the CSRD and reporting obligations for in-scope companies, including delayed application for many and exemptions for companies or groups with fewer than 1,000 employees. We estimate that few (if any) CLOs will be captured if the proposed amendments to CSRD are approved. These proposals remain subject to approval by EU institutions and subsequent national transposition.
Report on the Functioning of the EU Securitisation Regulation
On 31 March 2025, the Joint Committee of the European Supervisory Authorities (“ESAs”) published its report on the implementation and functioning of the EU Securitisation Regulation (the “JC Report”). The JC Report identifies areas where the EU Securitisation Regulation could be enhanced, such as simplifying transparency and reporting requirements, with the objective of supporting the growth of a robust and sound securitisation market in Europe. In particular, the JC Report recommends further harmonisation of supervisory practices, simplification of disclosure obligations and enhanced guidance for market participants.
Of particular relevance to the CLO market, the JC Report also states that, in the context of the “sole purpose test” applicable to originators under the EU Securitisation Regulation (and its related regulatory technical standards), the term “predominant” should be interpreted as meaning that the retention holder shall not be considered as operating for the sole purpose of securitising exposures where its revenues “correspond to no more than 50% on the exposures to be securitised, risk retained assets or proposed to be retained in accordance with Article 6 of the SECR, or any corresponding income from such exposures and risk retained assets”.
The JC Report further provided that any new issuances should apply this interpretation. The inclusion of this interpretation in the JC Report took the market by surprise and caused considerable disruption to Euro CLO issuances in the immediate aftermath of the report’s publication. For a time, the report favoured certain managers whose originators already fit the newly prescribed fact pattern. However, the market largely recovered its equilibrium by mid-summer with originator business plans adapting accordingly to the new reality.
European Commission Regulatory Reforms
On 17 June 2025, the European Commission issued its long-expected review of the EU Securitisation Framework together with an extensive draft legislative package that would revise the EU Securitisation Regulation, the Capital Requirements Regulation (CRR), the Solvency II Delegated Regulation and the Liquidity Coverage Requirement Delegated Regulation. The Commission’s headline message is clear: while the post-crisis regime succeeded in restoring confidence, it has now become unnecessarily restrictive and is holding back a market the EU views as critical for channelling risk, freeing bank balance sheet capacity and financing the green, digital and social transitions. The proposed measures therefore aim to revitalise issuance volumes, cut operational frictions and align prudential treatment more closely with the real risk of securitisation exposures, all without compromising investor protection or financial stability.
At the level of the EU Securitisation Regulation the Commission proposes a series of targeted, but potentially transformative, changes. For the first time, “public” and “private” transactions would be formally distinguished,
permitting tailored disclosure requirements and a streamlined reporting template for private deals. Investor due-diligence obligations would be materially lightened where EU-supervised sell-side entities are already subject to the supervision in the EU. However, no reduction in the due diligence requirement for investment in non-EU securitisations was proposed. The transparency reporting templates themselves are nonetheless stated to lose at least a third of mandatory data fields, which will benefit all deals including US CLOs. The rules on on-balance-sheet STS securitisations would be broadened to include (re) insurers as credit protection providers, subject to solvency and concentration criteria. Finally, supervisory convergence receives a fresh push: a reinforced joint ESA sub-committee led permanently by the EBA would co-ordinate rule application across Member States, including oversight of third-party verifiers and cross-border transactions.
Complementary proposed adjustments to the CRR are equally significant. Capital requirements would be adjusted by re-calibrating the risk weight floor, potentially unlocking materially lower capital charges for high-quality portfolios. The (p) factor, the main driver of non-neutrality in existing calculations, would be lowered across senior, STS and originator/sponsor positions, with the largest relief under the standardised approach. A new category of “resilient” senior positions, meeting enhanced criteria on granularity, amortisation and credit enhancement, would benefit from additional capital relief. Separately, the currently mechanical SRT tests would give way to a principle-based assessment under which originators demonstrate, via self-assessment and cash-flow modelling, that at least half of unexpected losses are transferred to third parties; a fast-track route is envisaged for straightforward structures.
The Commission’s proposal introduces a number of positive changes, including targeted relief from due diligence requirements in line with recommendations from expert groups and supervisory authorities, but also raises new uncertainties, particularly around the definition of public securitisation, where the treatment of securities listed solely for regulatory purposes remains unclear. As the legislative process continues, further consultations and amendments are anticipated.
ESMA Report and Draft Technical Standards
ESMA intended to publish a final report and submit draft technical standards to the EU Commission for endorsement in June 2025, however, in July 2025 ESMA announced that it decided to defer any changes to the technical standards until the European Commission’s wider review of the EU Securitisation Regulation provides clarity on key Level 1 framework concepts. ESMA acknowledged that the proposed template does not fully meet market expectations as expressed in the consultation responses. However, it was of the opinion that introducing changes to the disclosure regime before key concepts and definitions are clarified at Level 1 risks imposing unnecessary implementation costs and operational burdens, and could undermine the broader agenda on regulatory simplification and burden reduction.
European Commission’s Recent Legislative Interpretation of the “Originator” Definition
On 8 August 2025, the EBA published a response, prepared by the European Commission, clarifying that an entity entering into a conditional sale agreement with a CLO issuer does not qualify as an “originator” for the purposes of the EU Securitisation Regulation and therefore cannot fulfil the risk retention requirement on this basis. This position is based on the view that a conditional sale agreement does not constitute a true purchase of assets as required under the Regulation, since the retention holder only acquires the assets if a default occurs. This clarification had implications for CLO managers who had relied on conditional sale agreements to meet risk retention requirements, particularly in the context of the “originator-manager” approach and the seasoning of assets prior to CLO closing.
In contrast, forward purchase arrangements, where the originator commits to sell assets to the CLO issuer on a
forward basis, provided they have not defaulted during the seasoning period, are consistent with the Commission’s interpretation, as they involve an actual purchase and sale of assets. The Q&A does not provide for grandfathering, and the Commission’s position is presented as a clarification of existing law, meaning it may apply to both new and existing CLOs.
The resilience of the CLO market was again on display in reaction to this surprise clarification by the EU regulators, with live deals adjusting accordingly within days across warehouses to already-priced CLOs. Managers and originators continue to assess the impact of this development, including on legacy deals.
Outlook
Despite the increase in geopolitical tensions and financial market volatility, from our perspective, the European CLO market is well positioned for continued growth for the remainder of 2025. The continued divergence in interest rates between Europe and the US will increase the attractiveness of the European CLO market to investors which will in turn continue to drive additional US CLO managers to establish platforms in Europe. This, combined with a healthy pipeline of new deals, resets and refinancings mean that there are many reasons to be positive in the months ahead.
Should you have any questions regarding recent developments in European CLOs, warehouses, or prospective refinancing and reset transactions, please feel free to get in touch. We would be delighted to discuss how these market trends may affect your specific transactions and objectives.
Stephen McLoughlin Partner
+353 1 619 2736
stephen.mcloughlin@maples.com
Callaghan Kennedy Partner
+353 1 619 2716
callaghan.kennedy@maples.com
Joe
O’Neill
Partner
+353 1 619 2169
joe.o’neill@maples.com
Head of US CLO Management
Sculptor Capital Management
Lin Head of US CLO
Structuring & Origination
Bringing You CLOser
James Reeve Head of Cayman Islands
Structured Finance
Maples Group
In this Q&A, James talks with Josh Eisenberger and Michael Lin of Sculptor Capital Management about a variety of topics touching upon portfolio performance and challenges, issuance volume, the investor environment, trade tariff impacts, the refi / reset market, headwinds and future projections.
Q1. From a portfolio management perspective, what have been the key challenges year-to-date and do you envisage any substantive improvements or deteriorations on the horizon for the rest of 2025?
The 800-pound gorilla in the room so far this year has been the tariffs placed on foreign sourced goods. We’ve had some positive developments on that front over the last month or so with the assumed tariff on imported Chinese goods reduced from 145% down to 30% which will have a material impact on companies’ ability to survive or not in this new environment. However, the overarching issue is that a 30% tariff rate is still going to be inflationary. It’s certainly possible that many of the companies in our universe will be able to manage their inventory and supply chains in a manner that enables them to maintain their margins or see non-material impacts to their profitability, but the cost there will ultimately be borne by
Michael
Sculptor Capital Management
Josh Eisenberger
the end consumer / buyer. This means that everyday goods will see some amount of price increase. While some may not notice an increase, there are many others to which this is exceptionally impactful. Ultimately, the result is a march higher on inflation. All this activity led to substantial movement in the credit markets throughout April but given the subsequent reprieve from the 145% tariff on China, those who bought the April dip were rewarded handsomely.
The other large issue the market has been facing is the continuance of the liability management exercise (“LME”) activity that we have seen over the last 12-18 months. The general acceptance and coalescence around cooperation agreements (“Co-ops”) has given lenders ammunition to fight back against aggressive sponsors seeking to pursue discounts in their capital structure. We have started to see more 10–20-point discount trades, many of which receive near unanimous creditor support. While any number of these companies have or ultimately will need to restructure in the future, there are some that have been able to turn themselves around post an LME exercise.
We believe this represents a backdrop regarding the challenges that the market has faced so far this year. An uncertain tariff landscape immediately gave rise to a period of concerns over the next wave of LMEs, and while it feels like we are mostly out of the woods at this point, both domestic policy and geopolitical risks continue to inject regular bouts of uncertainty into our daily lives.
Q2. Early forecasts for 2025 issuance volume were on a par with, or in some cases exceeded, 2024. Market conditions have obviously shifted considerably since those initial forecasts. What would you highlight as some of the key developments and how do you think they may impact on overall issuance volume this year?
The CLO market (and the product itself) has been resilient in the face of macro and geopolitical risks presented to date. The market in early Q1 was overheated as CLO liabilities were gapping tighter by 5-10 basis points on each subsequent print. As a result, the market over-corrected and swung much wider, particularly on the back of tariff-related agita
that widened out to levels seen in Q3 and Q4 of 2024. Since then, we’ve seen an orderly reordering of the CLO market with a basis forming between new issue vs. reset transactions as well as tighter distribution in manager tiering.
The CLO reset and refi supply pipeline should remain active throughout the rest of 2025 as many deals that are in the money on their debt strikes are able to be repriced lower. We expect that dynamic to create some resistance on the lower bound of where AAAs can go, as material moves tighter on AAAs will bring out substantial reset supply and overwhelm the supply/demand dynamic. As AAA spreads widened out in the March to May timeframe, we felt that issuance might be dampened for the rest of 2025. Based on where the market has reset to now, we expect that issuance should remain robust for the rest of 2025.
Q3. Are you able to share any thoughts on investor demand / appetite and reported outflows in CLO exchange-traded funds?
The proliferation of CLO ETFs has certainly had a positive impact on the CLO markets. Retail investors had access to CLOs via a variety of strategies across the debt stack in an easily tradeable product without higher minimum denomination limits that investors would otherwise encounter investing directly in CLO debt tranches. CLO ETFs are still a relatively new product with the oldest ones having been around for less than 5 years. The ~US$31 billion of CLO ETF AUM today represents approximately 3% of the total CLO market buyer base. The reported
outflows post- ‘Liberation Day’ have mostly reversed as looming tariff threats were ameliorated when a deal with China was reached in mid-May. We foresee ETFs continuing to grow as CLOs have remained compelling investments even in an uncertain rate environment. As a manager we welcome the opportunity to broaden buyer bases and educate investors on the asset class.
Q4. During early April, in particular, the market took a notable ‘pause’ while it digested implications of the Trump administration’s initial tariff announcements / policies –has the market normalised and, if so, is activity muted due to a variety of other market factors, or lingering uncertainties around the tariffs and the more global, macroeconomic picture?
As we mentioned earlier, the initial pullback on the heels of the tariff announcement was fierce. The broader loan market traded off 4-7 points with the most impacted names being down 25-30 points or more. The loan issuers that were in the market with new issuances were forced to take material concessions or pull deals altogether – possibly, in hindsight, with pulling the deal being the right call. As high quality loans approached 8-10% yields it made it very challenging for any issuers to commit to new deals and likely put a damper on the new issue loan pipeline. Even with some stability coming back to the market, we are still seeing a hesitance on risk-taking for some of the dicier situations with investors preferring to bid up the prices of those loans perceived to be the most fortified.
This dynamic has unfortunately given a revival to the loan repricing market that we thought we had left behind in March. In summary, we’re seeing a bit of risk-on in names that people are most comfortable in, however, that has not yet spread to the more out-of-favour names in the market, a pattern that we tend to see during periods of indiscriminate risk taking.
Q5. What do you expect to see in the refi / reset market during the rest of the year?
At the end of Q1 we did a simple query in Intex to quantify the number of deals coming off non-call by the end of 2025 that had a AAA coupon greater than 150bp as a proxy for deals that would potentially be refinanced or reset throughout the year. The results were eye opening from a potential supply perspective as we saw the query return ~US$96 billion across 223 CLOs, with US$70 billion of that with a AAA spread of greater than 170bp. Since then, the market has worked through a decent amount of that supply as that number today stands at US$75 billion >150bp and US$50 billion >170bp. We believe that the refi and reset supply will remain robust throughout the year barring any large geopolitical or macro shocks and in turn will keep liability spreads range bound.
Q6. What would you identify as the top 3 headwinds for the rest of 2025?
1. Continued tariff and supply chain uncertainty and inflation that has not truly abated and may yet be stoked by the impacts of the new tariff regime.
2. Continued LME activity driving divergent utcomes across the same creditor class.
3. The persistence of higher interest rates which have continued to hamper certain parts of the market (housing and consumer) and continue to depress the M&A landscape as borrowing costs remain stubbornly high.
Q7. Sculptor travels to Japan frequently, what have you been hearing from Japanese investors and how does that inform your view on investor demand and appetite for CLOs?
Japanese investors have been buyers of CLO AAAs for a very long time and today likely comprise greater than 50% of the outstanding AAA base of CLOs. Japanese investors, particularly those in the life insurance space, have long compared yields on CLO AAAs to the JGB20 benchmark bond. With those yields sub 1% since late 2014, low-mid 100 spreads on CLO AAAs have long comped as highly attractive. In truth, given the WAL of a CLO AAA, the more appropriate comp has likely been the JGB5. However, with yields on those bonds being negative for much of the last decade it made for a tough comp to anything. Japanese investor demand for CLO AAAs is fundamentally very strong. They are comfortable with the asset class and given the very deliberate nature of onboarding new managers and new products, it seems like something that the investor base will want to remain invested in. The recent surge higher in Japanese yields and the cost of hedging at -40 bps, does, at some point, become a relative value issue. It is our view that most Japanese investors may have a difficult time getting
much tighter than S+120 in the current market environment, a very similar dynamic to what we saw in March 2025. While there are AAA buyers outside of Japan, we continue to believe it is challenging to price a meaningful amount of CLO issuance with yields that cannot be competitive with local currency Japanese government bonds.
Q8. In the longer term, looking ahead to 2026, do you expect any major changes for the global CLO markets?
As Josh mentioned above, Japanese interest in CLOs as an asset class continues to remain strong as we have heard some Japanese investors are expanding their scope to include both European CLOs as well as Middle Market or ‘Private Credit’ CLOs. If the US BSL CLO market experiences another bout of rapid tightening like we did in early 2025, we could see investor appetite out of Asia pivot to Middle Market CLO AAAs given the yield premium of 25-30bps compared to the BSL market. The additional spread coupled with the higher credit enhancement found in Middle Market CLOs, call it 42-45% par subordination on the AAA tranche, should get Japanese investors comfortable structurally, with the opacity of the underlying assets found in that market.
Increased interest out of Japan should be a net positive for the European CLO market as they would be adding another large buyer base. European CLOs could offer Japanese investors diversification benefits that include (i) slightly higher par subs and shorter duration (4-4.5 year reinvestment periods vs. 5 year reinvestment periods in US), (ii) lower incidence of LMEs given most European loans are multi-jurisdictional, making it more difficult to navigate loop holes across the laws of different countries, (iii) less exposure to volatile US trade policy
allowing for a more stable underlying credit base and (iv) offering slightly higher spread and lower hedging costs. Japanese investors may see European CLOs as less diverse because they hold larger positions in fewer loans, due to the smaller European loan market. It may also be harder to invest at scale since European CLOs are smaller than US BSL and Middle Market CLOs. Ultimately, we do not foresee the European market growing exponentially given this new buyer interest as the growth of that market will largely depend on the amount of growth they see in the European Leveraged Loan market.
We have continued to see a flurry of new managers enter the market with many of these new entrants backed by either large PE that lacked credit businesses or credit fund managers that did not have performing credit businesses. These new launches coupled with a depressed primary loan market continue to squeeze the existing secondary loan market, placing upward pressure on prices throughout all but the most stressed market backdrops. Even with a fair amount of uncertainty still present in the US economy driven by inflation, geopolitical uncertainty and an unclear tariff picture, loans have rebounded sharply, and we have already begun to see the beginnings of a new repricing wave. Overall, we expect the CLO market to remain an area of focus for firms that currently manage CLOs or are looking to enter the space, and we believe that this will lead to continued favourable market conditions for BSL issuers.
Arlene Shaw Managing Director Brightwood
Bringing Us CLOser
Amanda Lazier Partner
Maples Group
Alicia Thompson Associate Maples Group
Q1. Arlene, what first attracted you to Brightwood Capital?
It started with honest self-assessment. I raised my hand internally, interviewed at competitor firms, and serendipitously received a recruiter call for an in-house credit role. That recruiter reached me because Brightwood deliberately instructs search firms to surface diverse candidates. I fit the skill set and, equally important, the culture. Within two months, I accepted a role that cut my cash compensation by roughly 50 percent but gave me something priceless: senior leaders who were prepared to invest in me.
Q2. 50 percent is a steep cut. What convinced you to “bet on yourself”?
Women often seek certainty before accepting risk. My mantra became “lock in and bet on you, because you’ve never failed you.” I saw two Black co-founders whose spouses were professionals; they understood dual-career households and believed diverse talent can drive returns. That authenticity overrode the short-term pay cut. I also knew the accounting: I had saved enough to absorb the gap and was willing to take an asymmetric risk—limited downside, potentially huge upside in responsibility and equity.
Capital LLP
Q3. You joined Brightwood as an underwriting lawyer. Today, you run Capital Markets & Treasury. What catalysed that trajectory?
The firm deliberately moved me out of a pure legal silo. Our then CEO, Sengal Selassie, asked me to help renegotiate leverage facilities. My legal toolkit was solid, but he saw that my real differentiator was relationship management. He taught me the “softskills P&L”: if you can pick up the phone and move a lender from off-market terms to market terms, that is revenue. He challenged me: “Get on a plane, take the counter-party’s lawyer to lunch, close the loop.” Eventually senior management nudged me to leave the legal role for the Capital Markets seat.
Q4. You are outspoken on “fit” and “culture.” How should firms test for it, and how should candidates recognise it?
For firms, the question is: “Can this person grow here and make the organisation better?” Brightwood’s interview process surfaced non-résumé connectivity: our General Counsel was my law-school Dean’s sister-in-law; one co-founder and I shared a mentor. For candidates, look for environments where you can show up authentically.
Q5. Let’s talk about motherhood. You were the first associate in your practice group to become pregnant. What lessons can large firms take from that experience?
At the time, there was no discussion on flexible return or ramp-up. It forced me to confront whether I was building equity in the firm or simply trading time for money. Large firms must treat maternity as a strategic retention window. They have already invested millions in an eighth-year associate; a short period of flexibility protects that investment. Women also need to be realistic: this profession is cyclical and client-driven— sometimes the only solution is paid help at home, and that requires equitable compensation.
Q6. This is a two-part question: What is it about the term “work-life balance” that you find problematic, and have you noticed any generational differences in how millennials and Gen Z approach their career paths?
The term “work-life” balance implies a 50/50 equilibrium that does not exist in high-finance roles. The truthful model is flexibility. Some weeks the personal life will take precedent and other weeks work will be all consuming. I have Pilates at 6 a.m. only because my 11-yearold can now make himself breakfast. Junior professionals crave an ideal that senior people quietly know is fiction. We do everyone a disservice by perpetuating that myth.
Q7. Data show that more diverse teams outperform. Yet DEI programmes are under political pressure. How should the industry re-frame the debate?
Stop treating diversity as a moral imperative; frame it as a capitalist imperative. Empirical studies find female portfolio managers deliver steadier returns; male P.M.s swing for higher peaks and deeper troughs. In our private-credit portfolio, diversity of thought flags risks earlier because someone in the room has lived the borrower’s end-market reality. Position DEI as risk-adjusted outperformance, and the debate becomes shareholder-value language.
Q8. You often use the term ‘fit’ when advising younger talent. Could you unpack that?
Fit is the delta between your authentic self and the persona you perform at work. The larger the delta, the higher the daily cognitive tax. Seek environments where that tax is minimal so you can allocate energy to value-creating tasks.
Q9. You sit on a non-profit board and recently flagged a potential gender-bias blind spot in an ED job description. Can you share that anecdote?
The board listed “investment acumen” as the third bullet for a philanthropy executive-director role. I said, “Delete or demote it. Women dominate the foundation world but rarely carry a CFA.” If that remained a top three criterion, we would inadvertently filter out 80 percent of female applicants. Language is infrastructure; tweak it and the talent pool changes overnight.
Q10. You referenced “growing an ego.” How does one do that without tipping into arrogance?
Separate ego from entitlement. Ego is a calibrated understanding of your value proposition; entitlement is expecting reward absent performance. Spend a weekend writing your personal prospectus: skills, deals, relationships. That exercise inoculates you against imposter syndrome and clarifies gaps you still need to close.
Q11. Finally, what single message do you want the next generation of structuredfinance lawyers to hear?
Resilience is not a personality trait; it is a decision to keep solving the puzzle when the picture changes. The market will turn, politics will turn, but the value of differentiated thinking endures. Bet on yourself, lock in, and remember you have never failed you.
Listings Update
Cayman Islands Listing Update
As of 30 June 2025, 57 CLOs have listed on the Cayman Islands Stock Exchange (“CSX”), comprising new issuances, refinancings and resets, as compared to 53 CLOs listed on the CSX during the same period last year. Of these 57 new CLO listings, 68% (39) were by Cayman Islands issuers with Delaware co-issuers; 23% (13) were by Jersey issuers with Delaware co-issuers; 7% (4) were by Bermudian issuers with Delaware co-issuers; and 2% (1) were by Delaware issuers.
Of the 57 CLO listings on the CSX through to the end of June, resets and refinancings listed on the CSX with slightly greater frequency than new issuance deals: 53% of the CSX-CLO listings were refinancing or reset deals and 47% of the listings were new issuance deal. The balance between new issuance listings and refinancing or reset listings was similarly evenly split in 2024, with 49% new issuance listings and 51% refi or reset listings during the same period last year.
For 2025 so far, March and June have been the most active months for CLO listings on the CSX, with 13 and 12 listings, respectively.
During the first half of 2025, only 7% of CLOs listed their full stack of notes on the CSX. Over 45% listed a single tranche of notes, and 33% listed two or three tranches of notes.
The Maples Group listed 40% of all the CSX-listed CLOs during this period, including 41% of the Cayman Islands issuers and 54% of the Jersey issuers listed on the CSX.
Based on the Maples Group’s recorded data through to the end of June 2025, approximately 16% of new issuance CLOs sought a CSX listing for one or more tranches of notes, and approximately 8% of refinancing or reset transactions sought a CSX listing for one or more tranches or notes.
For further details, please contact:
Your Global CLO TeamA CLOser Look
Hi, I’m Alicia Thompson, an associate in the Finance team of the Maples Group in the Cayman Islands.
Alicia Thompson
Q. How would you describe yourself in three words?
When I think of myself, there are pool of words that I could pull from, but since I am limited to three, I would say I am authentic, goal oriented, and humorous.
Q. What’s a fun fact about yourself?
A fun fact about myself is that I recently started playing tennis. It has now become my whole personality and I think that I will be the next Serena Williams.
Q. What’s something on your bucket list?
While I don’t have an extensive bucket list, I would love to attend the Olympic Games as well as catch an NBA finals match, particularly with Steph Curry.
Q. What’s one habit you’ve developed that has positively impacted your life?
A habit that I have recently developed that has had a profound impact on my life is going for long walks,
oftentimes without headphones. This allows me to disconnect, reflect and reset.
Q. Who’s your biggest inspiration?
My biggest inspiration has been my mom. She moved from Jamaica to the Cayman Islands 39 years ago in search for a better life for herself and my siblings.
Q. How do you achieve a good work/life balance?
Achieving work life balance can be difficult. However, I try to attain this by setting clear boundaries, becoming best friends with my calendar and my to do list, and prioritising my well-being.
Q. What’s one thing you still want to accomplish in your lifetime?
As I recently got married, my next big accomplishment would be starting a family with my husband. It is something near and dear to our hearts and we look forward to the challenges, the memories and the love that comes with it. Associate | Finance | Cayman Islands
Your Global CLO TeamA CLOser Look
Hi, I’m Jamie Sanford, and I’m a Vice President in the Structured Finance team for the Maples Group.
Jamie Sanford
Vice President | Structured Finance | Cayman Islands +1 345 814 6687 |
jamie.sanford@maples.com
Q. What’s one professional achievement you are most proud of?
I think it’s two. I was the first in my family to graduate from university, so that definitely means quite a lot to me and second, would be qualifying as a trust in estate practitioner.
Q. How do you achieve a good work/life balance?
I think routine is very important for maintaining a work life balance, as well as discipline and just setting healthy boundaries.
Q. What’s one habit you’ve developed that has positively impacted your life?
I would say diet, definitely. A good diet can definitely impact how you feel mentally as well as physically.
Q. Who’s your biggest inspiration?
My parents and my grandmother, I would say from my parents, they were pretty instrumental in my career up until this point and multiple facets of my life and my
grandmother, just for her warmth and for spoiling me unceasingly and unfailingly as well. So, I would say that. So, thanks, Mom and dad and, thanks, granny.
Q. What’s a fun fact about yourself?
I’m quite a movie savant. Something that I picked up from my mother years ago, and it’s kind of stuck with me. I don’t get to consume as much content as I did in the past but yes watch quite a lot of movies.
Q. What’s something on your bucket list?
Going to see the Seven Wonders of the world. I have three down. And one that I primarily want to see is definitely the Great Wall of China.
Q. What’s one thing you still want to accomplish in your lifetime?
It would have to be the CFA. I’m quite passionate about investing and that’s been something on my list for quite some time now.
A Global Team
Our CLO team comprises 39 specialist CLO lawyers and over 80 specialist CLO fiduciary professionals across our global network. Since the inception of the CLO market over 20 years ago, we have provided our clients with the benefit of our unparalleled depth of knowledge, experience and insight into what we see across the whole structured finance market, from the latest warehousing structures, to the latest regulatory developments and how they impact CLOs, to ongoing post-closing CLO issues.
For further information, please speak with your usual Maples Group contact or the primary CLO contacts below.
Legal Services
Cayman Islands
James Reeve +1 345 814 5129 james.reeve@maples.com
John Dykstra +1 345 814 5530 john.dykstra@maples.com
Tina Meigh +1 345 814 5242 tina.meigh@maples.com
Jonathon Meloy +1 345 814 5412 jonathon.meloy@maples.com
Anthony Philp +1 345 814 5547 anthony.philp@maples.com
Amanda Lazier +1 345 814 5570 amanda.lazier@maples.com
Dublin
Stephen McLoughlin
+353 1 619 2736 stephen.mcloughlin@maples.com
Callaghan Kennedy +353 1 619 2716 callaghan.kennedy@maples.com
Andrew Quinn +353 1 619 2038 andrew.quinn@maples.com
William Fogarty +353 1 619 2730 william.fogarty@maples.com
Lynn Cramer +353 1 619 2066 lynn.cramer@maples.com
Joe O'Neill +353 1 619 2169 joe.o'neill@maples.com
Hong Kong / Singapore
Michael Gagie +65 6922 8400 michael.gagie@maples.com
Jersey
Paul Burton +44 1534 671 312 paul.burton@maples.com
Mark Crichton +44 1534 671 323 mark.crichton@maples.com
Amy Black +44 1534 671 317 amy.black@maples.com
London
Jonathan Caulton +44 20 7466 1612 jonathan.caulton@maples.com
Luxembourg
Arnaud Arrecgros +352 28 55 12 41 arnaud.arrecgros@maples.com
Yann Hilpert +352 28 55 12 58 yann.hilpert@maples.com
Fiduciary Services
Cayman Islands
Guy Major +1 345 814 5818 guy.major@maples.com
Peter Lundin +1 345 814 5757 peter.lundin@maples.com
Cleveland Stewart +1 345 814 6624 cleveland.stewart@maples.com
Delaware
James Lawler +1 302 340 9985 james.lawler@maples.com
Dublin
Stephen O’Donnell +353 1 697 3244 stephen.odonnell@maples.com
Jersey
Marc Randall +44 7829 933 113 marc.randall@maples.com
London
Sam Ellis +44 20 7466 1645 sam.ellis@maples.com
Netherlands
Allard Elema +31 203 998 233 allard.elema@maples.com