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BNY Mellon appointed trustee and principal paying agent for Commerzbank's first European CLO

  • BNY Mellon acted on more than a quarter of European CLOs in 2014
  • First static CLO issued in Europe since the financial crisis

BNY Mellon, a global leader in investment management and investment services, has been appointed trustee and paying agent for Bosphorus CLO I Limited. It is Commerzbank's first European CLO and is being managed by the bank's Debt Fund Management division.

The €233.4 million collateralised loan obligation (CLO) will securitise a portfolio of senior secured loans and bonds granted to European companies. Sterne Agee & Leach, Inc. is acting as arranger and also making its debut in the European CLO market.

CLO issuance in Europe in 2014 reached €14.29 billion, which was double the issuance of the previous year1. BNY Mellon acted as either paying agent or trustee on more than a quarter of the 34 CLOs that were issued in the region2.

"This deal demonstrates our continued partnership with clients on innovative solutions in this rapidly rebounding market," said Dean Fletcher, Head of Corporate Trust EMEA at BNY Mellon. "This is Europe's first static CLO3 since the financial crisis, which provides investors with an alternative to actively managed vehicles by offering a combination of yield, asset quality and reduced management costs. The tight spread reflects investors' enthusiasm for the offering. The senior tranche of Bosphorus CLO I Limited is priced at 115 basis points above Euro Interbank Offered Rate, which is one of the tightest spreads in the European CLO market."

BNY Mellon will also act as custodian, account bank, information agent, calculation agent, registrar and transfer agent to Bosphorus CLO I Limited.