TRS Deals Return to Loan Market

Kellerhals, Richard
October 2010
High Yield Report;10/25/2010, Vol. 21 Issue 43, p20
This article discusses the use of total return swaps (TRS) in the leveraged loan market in the U.S. in 2010. It expects a rise in the number of TRS accounts to result to increases in cash flow and leverage. It expresses concerns about the risk of the transfer of assets from the bank to a counterparty in TRS deals. The article also indicates the formation of collateralized loan obligations (CLOs) due to an increase in the number of TRS.


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