Cleary Gottlieb has been a leader in structured finance for decades, having pioneered many of the key products used widely in today’s markets, including development of the first CMO, CBO, agency REMIC, interest rate swap and currency swap.

Our renowned team represents issuers, underwriters, asset managers, industry associations and other market participants in a broad-based finance and securitization practice that most prominently features CLO transactions, agency mortgage securitizations, esoteric securitizations and asset-based lending transactions, fixed-income derivatives, repackagings, and other structured credit and structured finance products.

Cleary is consistently ranked among the top CLO legal advisors for our representation of the leading arrangers and investment managers. We also have advised on the large majority of agency mortgage-backed securities transactions for more than two decades.

We also are regularly engaged to guide clients on novel and complex structured finance transactions, as well as provide compliance and regulatory advice on the impact of U.S. and EU risk-retention requirements, the Volcker Rule and other regulatory initiatives. This has included playing a leadership role with industry associations such as the Loan Syndications and Trading Association (LSTA) and the Securities Industry and Financial Markets Association (SIFMA) regarding major issues of concern to the structured finance market.

We often work closely with colleagues in our European offices on cross-border regulatory issues affecting structured finance transactions, including the evolving standards for European risk retention and Simple, Transparent and Standardized securitization.

Notable Experience

Regulatory Highlights

  • Counsel to several non-U.S. banks and other nonadvisers on compliance with Advisers Act requirements, including registration and exemption issues.

  • Counsel to a major financial institution in connection with novel arrangements with a specialty broker-dealer to acquire senior debt of the specialty broker-dealer which would provide capital support for repurchase transactions with customers referred by the broker-dealer affiliate of the financial institution.

  • Crescent Capital in obtaining a significant no-action letter from the SEC establishing the conditions for exempting from the U.S. risk retention rules refinancings of CLO debt that occur following the effective date of those rules.
  • Several major private equity funds, hedge funds and financial services firms on enforcement and regulatory issues, including the Investment Advisers Act and Investment Company Act, arising from Dodd-Frank and regulatory reform.

  • SIFMA in an engagement with Bloomberg and a consulting firm to classify issuers in the trading context for purposes of Volcker Rule compliance, including criteria to support new “tagging” procedures for trading screens that will be used by market participants.
  • Counsel to major investment banks and asset managers in responding to inquiries from U.S. federal, state and non-U.S. regulators concerning structured finance products and in performing internal reviews of structured products.

  • Regular counsel to numerous international banks on the application of the Volcker Rule to a wide variety of structured finance products, including the impact of the Volcker Rule on CLOs.

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Transactional Highlights

  • Citigroup and StoneCastle Financial Corp. in the origination and securitization of Tier 2 qualified subordinated loans to community banks. The initial securitization in October of 2015 was the first such securitization of subordinated bank debt since the financial crisis.

  • Counsel in the structuring and offering of more than $70 billion in CLO transactions in 2016–2018. Underwriters include Bank of America Merrill Lynch, Citigroup, Credit Suisse, Goldman Sachs, Natixis and Nomura; collateral managers include Gallatin Loan Management, CVC Credit Partners and Invesco.

  • Counsel to the underwriters on more than $1.5 trillion in Fannie Mae, Freddie Mac and Ginnie Mae mortgage-backed transactions since 2009, including approximately $331 billion in 2016–2018. Clients include Amherst Pierpont, Citigroup, Deutsche Bank, Goldman Sachs, Jefferies, JP Morgan, MUFG, Mizuho, Morgan Stanley, Nomura, RBC and RBS.

  • Verizon Communications in the establishment of a platform for the sale to a variety of banks and their asset-backed commercial paper conduits of installment receivables generated by their sale of wireless equipment.

  • Strategic Credit Partners Holdings LLC, a joint venture between CIT Group and Sixth Street Partners, in a $100 million revolving secured credit facility for the acquisition of middle-market loans.

  • Bank of America Merrill Lynch in over $3 billion of asset-based lending and structured credit arrangements.

  • Goldman Sachs as placement agent in the re-pricing of a debt class of the Emerson Park CLO—the first re-pricing to be completed in the CLO market.

  • Goldman Sachs in connection with various esoteric structured financings, including patent receivables; aircraft, license, and film finance; and Brazilian real-denominated securities backed by a revolving portfolio of payroll deductible loans.

  • Regular counsel to numerous international banks on the application of the Volcker Rule to a wide variety of structured finance products, including the impact of the Volcker Rule on CLOs.

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