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Floating rate bonds are much less creditor friendly.
As the chart shows floating rate issuance is a long way from its 2006 peak, but as more LBOs refinance, CLO demand for floating rate bonds will rise.
Merrill Lynch & Co. Allete, $300 million of floating rate of senior notes due 2003, Baa2/BBB/.
Public Services Electric & Gas, $300 million of floating rate notes due 2002.
Florida Hurricane Catastrophe Fund Finance Corporation, $2 billion of taxable floating rate notes.
A Japanese firm might want to borrow yen at a floating rate.
Similar(33)
BLOOMBERG NEWS Treasury Considering a Floating-Rate Security | The Treasury Department is considering offering a floating-rate debt security, a departure from the fixed-rate securities that offer investors consistent payments, The Financial Times reports.
I was wrong on inflation, but my floating-rate picks have done quite well.
The entire transaction swapping fixed-rate dollar assets into floating and then swapping the dollar floating-rate proceeds into euro floating-rate assets–now costs 5 basis points.
But CLOs are required to invest in floating-rate bonds, to match their floating-rate liabilities.
Households with floating-rate mortgages would not welcome that.
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