European CLO issuance to double by 2030

Annual European collateralised loan obligation (CLO) issuances will double to be worth up to €75bn (£62.13bn) before 2030.

According to a new analysis from Indefi, European CLOs are perfectly positioned to benefit from the fading boundary between public and private markets.

Indefi has forecast a “significant expansion” in the European CLO market, driven by upcoming regulatory reforms in the EU, which are expected to address existing constraints such as the high capital charges under Solvency II.

This could create a more conducive environment for CLO issuance, Indefi said.

Read more: European private credit CLOs ‘will remain niche’, says Moody’s

“The boundaries between public and private markets are increasingly dissolving, and CLOs offer a natural extension to credit platforms that are strategically positioning themselves for opportunities within a converging investment landscape,” said Richard Bruyère, managing partner at Indefi.

Read more: CLO ETF market grows to $19bn

Earlier this year it was reported that European CLO issuance was reaching record levels, with more than €22.7bn issued in the first five months of this year, according to Bank of America data.

Indefi said that this surge presents “a considerable revenue opportunity for CLO managers and offers investors diversified avenues for credit exposure”.

Read more: Permira prices debut US CLO and 11th European CLO