Axa Investment Managers this week issued a €1.3 billion managed synthetic collateralised debt obligation (CDO), called Aria CDO 1, the largest single-tranche deal to date.The deal, arranged by JP Morgan Chase, was issued in five currencies – Swiss francs, sterling, dollars, euros and yen. It offers investors the possibility to receive fixed, floating and inflation-linked coupons, across a range of rated tranches and with bullet maturities of either five or seven years.
Aria closes this Friday and has 25 different tranches, referencing a portfolio of some 140 corporate names. It was designed with the intention of attracting a broad investor base across Europe, following the success of the Overture deal, released by Axa last November, and also arranged by JP Morgan Chase. The Overture deal hit the headlines last year as the largest CDO released into the European market and the first to be distributed on a syndicated basis, rather than being underwritten by a single investment bank.
Like Overture, Aria was globally syndicated by a team of banks: Royal Bank of Scotland in the UK, Gulf International Bank in the Middle East, Mizuho Securities in Japan, Natexis Banques Populaires in France and the Korean Development Bank. This, said the arrangers, has allowed the deal to gain greater global access to investors, with around 60 different investors in 15 countries. And also, with more institutions analysing the underlying bonds, investors can be more confident of their credit quality than with other CDOs.
The arrangers said Aria was released partly to meet the excess demand for the Overture CDO, which had seen some of the more senior tranches up to nine times over-subscribed.
More on Credit Derivatives
UBS in Australia sold off CDS portfolio in fixed income scale-back
Fears relationship between credit indexes and constituents becoming more tenuous
A new product could smoothe the gap between capital and accounting rules
Banks can use maths - rather than special chips - to boost computing speed
Sign up for Risk.net email alerts
Nominated for two technology awards
Nominated for post trade technology award
Sponsored webinar: Collateral and counterparty tracking
Isda directors warn on fragmentation, access and liquidity - but expect problems to pass
There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.