Mizuho Corporate Bank issues JPY279.9 billion (USD2.5bn) Synthetic CLO

LAWFUEL – Legal Announcements – International legal practice Allen & Overy has once again advised Mizuho Securities Co., Ltd. as arranger in relation to a JPY279.9bn synthetic CLO for Mizuho Corporate Bank, Ltd. This is the fourth synthetic CLO Allen & Overy has advised Mizuho Corporate Bank, Ltd. on and it will assist the bank to further enhance its proactive portfolio management strategy.
This JPY279.9bn CLO relates to a portfolio of loans advanced to non-Japanese corporate borrowers. In total JPY25.3bn worth of notes were issued by CuBic One Limited (a Cayman SPV) with ratings from Moody’s and S&P ranging from Aaa/AAA to Ba2/BB. The remainder of the credit default swaps were with a super senior counterparty.

One feature of the transaction is that it operates on a ‘blind pool’ basis, meaning that the identities of the borrowers participating in the portfolio are kept confidential from the noteholders and the super senior swap counterparty.

BNY Corporate Trustee Services Limited was trustee in connection with the issue of Notes by CuBic One Limited.

Allen & Overy’s Tokyo office has unparalleled experience in Japan with respect to synthetic balance sheet transactions. The aggregate principal value of the deals the legal practice has worked on in recent years totals more than JPY3.5 trillion (USD30.5bn).

Jason Humphreys, partner at Allen & Overy’s International Capital Markets Group, said: “We are delighted to have been able to assist Mizuho on this transaction. We expect the implementation of the Basel II regulations in Japan to result in more lenders looking to manage their balance sheets using this type of product. With our strong track record we would hope to be well placed to advise those lenders.”

The Allen & Overy team was led by partners Jason Humphreys (Tokyo) and Matthew Hebburn (Hong Kong) and associates Guy Antrobus (Bangkok) and Richard White (Tokyo). The Allen & Overy team advising the Trustee was led by London-based partner Simon Hill and counsel Malcolm Charles.

For further information, please contact Tamsin Bradshaw, tamsin.bradshaw@allenovery.com, in Tokyo on +81 3 5114 1669; or Yvonne So, yvonne.so@allenovery.com, in Hong Kong on +852 2974-7091; or Caroline Livesey, caroline.livesey@allenovery.com, in London on +44 20 3088 4380.

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