China CLO market stutters on economic slowdown

Increase in liquidity and a rise in NPLs slow China structured credit market

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Lower CLO issuance causes 50% drop in ABS volumes

Despite China authorities relaxing the regulatory framework for issuing asset-backed securities (ABS) at the end of 2014, a combination of rising liquidity in the banking sector and an increase in non-performing loans this year, has actually seen issuance of this type of structure fall by half.

In late 2014, the China Banking Regulatory Commission launched a streamlined issuance process for ABS and in January it cleared 27 Chinese urban commercial banks to be the first batch of qualified issuers

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