Media Mentions
SRZ Partner Craig Stein Quoted in Structured Credit Advisor: "Administrative Burden"
July 20, 2022
Why would the new reporting, record-keeping and disclosure requirements proposed by the SEC earlier this year be difficult for CLOs to abide by?
SRZ partner Craig Stein explained when he recently spoke with Structured Credit Investor: “[t]he problem with the rule is that it applies to all existing CLOs, which would all have to, in some way, shape or form, comply with the new rules. But the CLO documents don’t easily allow for that...not only is it difficult to amend the documents, but CLOs are not structured to deal with the additional costs. So, if we had to suddenly hire accountants to run audits, that is an expense that the deal isn’t structured for...The CLO waterfall has administrative expenses capped at the top and they’ve been capped at a level that would allow for ordinary expenses, as well as some extraordinary expenses. So, if suddenly you have all these additional expenses, it’s going to be difficult.”
Read the article here.