Mitsubishi UFJ Asset Management (MUAM) will launch its first fund comprising collateralized loan obligations (CLOs), heeding the government¡¯s call on finance firms to offer products that boost returns for Japanese investors.
The securities, which are bundled leveraged debt, will mainly hold dollar-denominated floating-rate loans made to U.S. companies. The unit of Mitsubishi UFJ Financial Group, Japan¡¯s biggest bank, aims to launch the fund in January with a size of several billion yen, according to Kosuke Nagata, general manager of the firm¡¯s credit investment division.
¡°It is extremely important to diversify interest-rate risk within a bond portfolio,¡± Nagata said in an interview. In that regard, being able to offer investors floating-rate assets is a key development, he said.
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