Sector developments and company hires

CLO manager transfer
Hunt Investment Management has assigned collateral manager duties for the Hunt CRE 2017-FL1 and Hunt CRE 2018-FL2 CRE CLOs to OREC Investment Management. Moody's has confirmed that the move will not result in any adverse rating action. For more CDO manager transfers, see SCI’s database.

Credit opportunity fund
Arrow Global’s new Arrow Credit Opportunities SCSp fund has raised €628.5m of third-party capital commitments into an eight-year closed-end fund structure, with €838m achieved in total capital commitments so far. The fund is targeting €2bn of total AUM in selective European credit opportunities before end-2020, including commitments from Arrow Global, which will invest at least either 24.9% of the final commitment made to the fund or €500m as a co-investor. The firm says the fund is central to its strategy to accelerate towards a more capital-light model. AGG Capital Management, a Jersey-incorporated and wholly-owned subsidiary of Arrow Global, will serve as portfolio manager to the fund.

Fairhold restructuring proposed
Proposed restructuring terms have been agreed for the Fairhold Securitisation CMBS, which would - if implemented - deliver between 57% to 73% recovery for the class A notes on a sale of the underlying assets, based on an illustrative £700m-£800m enterprise value for the group at December 2019. Key terms of the restructuring include: the establishment of a new group of companies, ultimately owned by the class A noteholders and the issuer swap counterparties in circa 66%/34% split respectively; the transfer of the property owners to the NewCo Group; and the exchange of existing indebtedness of the issuer for £369m new senior secured notes for the benefit of the swap counterparties and £341m junior secured notes, of which £227.7m are for the benefit of the class A noteholders and £113.3m for the benefit of the swap counterparties.

North America
Mark Gruber is set to retire from his role as ARMOUR Residential REIT cio and coo on 31 March 2020, in order to pursue outside interests. The company’s current co-ceo, co-vice chairman and chief risk officer Scott Ulm and David Sayles, the md for portfolio and risk analysis for ARMOUR Capital Management, will act as co-cios on Gruber’s retirement. Jeffrey Zimmer, the company’s current co-ceo, co-vice chairman and president, will assume the responsibilities of coo while it conducts a search for a permanent replacement.

Assured Guaranty Corp has recruited Steven Kahn as senior md, structured finance. The group will be led by Kahn, along with md Dan Bevill, who has been part of Assured Guaranty’s structured finance team for 15 years. The pair will report to Nick Proud, senior md of Assured Guaranty’s international and structured finance businesses. Kahn was previously an md in the structured products group at Mizuho Securities and, before that, worked at Invicta Capital, Financial Security Assurance and Ernst & Young.

Price-fixing settlement
Pennsylvania Treasurer Joe Torsella has announced that a proposed stipulation of settlement has been filed to resolve outstanding claims against all remaining defendant banks in a lawsuit alleging price-fixing of GSE bonds. The case is presently before the US District Judge for the Southern District of New York. The remaining defendants will pay US$250m in damages, meaning that in total - including earlier settlements - the monetary settlement recovery on behalf of the class of investors harmed by the 16 original defendants will be US$386.5m (representing approximately 58.4% of their proportionate share of single damages). As part of the settlement, all defendant banks have agreed to establish and maintain an effective antitrust compliance programme. Settlement agreements were previously reached with Deutsche Bank, First Tennessee Bank, Goldman Sachs and Barclays; the 12 remaining defendants are BNP Paribas, Cantor Fitzgerald, Citi, Credit Suisse, HSBC, JPMorgan, Merrill Lynch, Morgan Stanley, Nomura, SG, TD Securities and UBS.