COLLATERALIZED LOAN OBLIGATION
collateralized loan obligation: translation
collateralized loan obligation ( CLO)
A multi-tranche security secured by a pool of corporate loans. Similar to the more familiar CMO, except that in a CBO the tiers or tranches are created with differing levels of credit quality. The CBO structure creates at least one tier of investment-grade bonds, thus providing liquidity to a portfolio of junk bonds. American Banker Glossary
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( CLO)
A security backed by a pool of commercial or personal loans , structured so that there are several classes of bondholders with varying maturities ( maturity), called tranches. Similar in structure to collateralized mortgage obligations. Bloomberg Financial Dictionary