The outsized sway of the collateralized loan obligation market's triple-A investor is no secret — simple math will tell you that the relatively small group of investors buying up what is generally the largest tranche of a CLO transaction will have more power to dictate terms than would be the case if demand for triple-As were broader.

Interestingly, new regulations have driven some banks out of that group. The shrinking pool of buyers has heightened the influence of the remaining triple-A investors — and makes it more likely that they will continue to wield this power over the growing CLO market.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.