explain CLO bank debt?

Question

Accepted Answer

CLO bank debt refers to debt issued by collateralized loan obligations (CLOs) to finance leveraged loans.

CLO bank debt is a type of debt issued by CLOs, which are special purpose vehicles that invest in a diversified pool of loans.
The proceeds from CLO bank debt are used to finance leveraged loans, which are loans made to companies with high levels of debt.
CLO bank debt typically has a seniority ranking within the CLO structure, meaning it has priority in receiving payments from the underlying loans.
Investors in CLO bank debt receive interest payments and principal repayments based on the performance of the underlying loans in the CLO portfolio.

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