U.S. Structured Credit 2022 Outlook
Despite a second year set against the backdrop of the Coronavirus Disease (COVID-19) pandemic, collateralized loan obligation (CLO) ratings continued to perform in line with our expectations in 2021. As 2022 begins, the economy is strengthening and employment levels are improving, but the omicron variant represents yet another speedbump on the path to recovery, with escalating cases and the possibility that governments might once again implement closures. However, given the shortened recommended quarantine periods for individuals who tested positive or were exposed to the virus, closures don’t seem likely, which is a positive for both the economy and consumers, especially as it relates to remaining gainfully employed. Our baseline macroeconomic scenario pegs GDP growth at approximately 5.6% for 2021, a level not seen since the mid-1980s, after a year of contraction in 2020. We have stable outlooks for both the broadly syndicated loan CLO and middle market CLO sectors.
DBRS Morningstar is a global credit ratings business with 700 employees in eight offices globally. DBRS and Morningstar Credit Ratings are committed to empowering investor success, serving the market through leading-edge technology and raising the bar for the industry.
Together, we are the world’s fourth largest credit ratings agency and a market leader in Canada, the U.S. and Europe in multiple asset classes. We rate more than 2,600 issuers and 54,000 securities worldwide and are driven to bring more clarity, diversity and responsiveness to the ratings process. Our approach and size provide the agility to respond to customers’ needs, while being large enough to provide the necessary expertise and resources. For more details visit us at dbrs.com.
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