Insurers turn to structured credit in search for yield in Asia
Low global interest rates look to be set to stay, so Asian insurers are considering their options in the search for yield, with structured products and CLOs on the menu
According to some, there has been increasing acceptance over the past year among Asian insurers that the era of lower returns is not just here but is in fact the new normal. This has led to some searching for yield in new areas; resulting in the unexpected return to portfolios of structured credit instruments such as collateralised loan obligations (CLOs), and has increased the presence of insurers in primary debt markets, as well as spurring forays into more exotic forms of structuring.
Paul
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