4th Jun 2019 12:33
LONDON (Alliance News) - Marble Point Loan Financing Ltd on Tuesday reported a rise in net assets at the end of the first quarter but warned its collateralised loan obligation investments could be hurt by a global economic downturn.
The Guernsey-domiciled closed-ended investment company holds a portfolio of dollar-denominated syndicated floating rate senior secured corporate loans owned via collateralised loan obligations.
At March 31 the company's NAV per share stood at USD0.86 compared to USD0.82 at December 31, a 4.5% increase.
The company's net assets increased 5.1% over the same period, ending the quarter at USD176.6 million from USD168.0 million at the end of 2018.
In the quarter, Marble Point Loan Financing recorded investment income of USD3.3 million, more than treble the USD1.0 million seen in the first quarter of 2018.
"During the recent past, the US economy and the global economy have suffered the effects of a crisis in the credit markets. Among the sectors of the global credit markets that experienced particular difficulty during the credit crisis were the CLOs and leveraged finance markets. There is no assurance that such markets may not experience similar difficulties in the future," the company said.
Marble Point continued: "There continues to exist significant risks for the company as a result of uncertain or volatile economic conditions. These risks include, among others, the likelihood that it may be more difficult to sell any of the loans or other underlying assets to which the company obtains exposure in the secondary market, thus rendering it more difficult to dispose of such assets; the possibility that the price at which such assets can be sold will have deteriorated from their effective purchase price; the illiquidity of the company’s share capital, as there is currently minimal or no secondary trading in equity securities issued in connection with entities such as the company; and the possibility of a recession or other economic downturn affecting obligors. These risks may affect the returns of the company."
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