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Asia Secondary Traded Loans $1b-$5b Per Year, Says SC Lowy

2017-02-09 09:41:52.568 GMT

By Denise Wee

Michel Lowy at APLMA 2017

(Bloomberg) — Michel Lowy, chief executive officer of SC Lowy, says estimated volume of secondary traded loans $1b-$5b in Asia, versus $60b-$100b each yr in Europe in last five years.

* SC Lowy traded over $13b of assets in 2016, with Asia making up less than 10% of volume traded, he said at the Asia Pacific Loan Market Association conference in Hong Kong today

* Says assets traded in Asia tend to be “more stressed” and price volatility “significantly bigger”

* “In the U.S. loan market, 50% of institutional underwriting of loans is done by collateralized loan obligations”

* “There’s not a single CLO in Asia. Our firm was marketing a CLO last year, we are still in the process of marketing it, and believe it will be the breakthrough.”

* Leveraged loan market is “main source” of secondary trading globally; Asia “barely” has such a market

* “In the U.S., $1-1.2 trillion of leveraged loans per year were sold in the last five years, two-thirds underwritten by institutional investors.”

* “In Europe, leveraged loans sold are $100-$200 billion every single year. In Asia, in the last couple of years, only about $10 billion of leveraged loans were sold.”

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