Leveraged loans and CLOs hit by credit slump

The dislocation in the credit markets has spread to leveraged loans and collateralised loan obligations, says Fitch Ratings in a new report.

“The credit crunch is reshaping the leveraged loan market,” says William May, senior director of Fitch credit market research. “Aggressive loan structures, in particular, will be put to a significant test over the coming year.”

As with all structured finance vehicles, CLO performance is inextricably linked to the performance of the underlying collateral. As

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