Collateralized loan obligation

Collateralized loan obligation (CLO)
A security backed by a pool of commercial or personal loans , structured so that there are several classes of bondholders with varying maturities, called tranches.

* Collateralized loan obligations CLO: Bond issued against a pool of bank loan. It is referred to in a generic sense as a CDO
CDO refers either to the pool of assets used to support the CLNs or, confusingly, to the CLNs themselves.

Source: (Pimbley, Joseph. "LC: Evaluating Risk in Russian Roulette Notes and CBOs." DW, 7/17/95, p. 7.) Collateralized Loan Obligation (CLO) Definition: An ABS (q.v.) structure similar to a CMO (q.v.), ...

In this section, we'll describe how the risk of default for collateralized loan obligations can be mitigated. This was of particular concern for investors during the subprime mortgage crisis that accompanied the Great Recession of 2008 / 2009.

See also: Debt, Interest, Yield, Market, Interest Rate