San Bernardino Pension Fund Investing With U.K.’s Cairn Capital

California’s San Bernardino County Employees’ Retirement Association said it’s investing in a deal with Cairn Capital Ltd., the U.K. firm that’s selling the first European collateralized loan obligation since 2011.

Nicole Dailey, a spokeswoman for the pension fund known as SBCERA, declined to say whether the 300.5 million-euro ($407 million) CLO, a high-risk debt instrument popular before the financial crisis, is the Cairn deal her firm is invested in.

Two CLOs have been sold in Europe since 2008 as investors shunned hard-to-value assets in the worst credit crisis since the 1930s. The market has been quicker to recover in the U.S., where issuance more than quadrupled to $55.4 billion in 2012 and is forecast by Wells Fargo & Co. to reach $80 billion this year.

Adam Bradbery, a London-based spokesman for Credit Suisse Group AG (CSGN), which is arranging Cairn’s CLO, and a Cairn official declined to comment.

Deutsche Bank AG arranged a CLO for European Capital Management in 2011, and Intermediate Capital Group Plc completed a deal a year earlier.

The most junior notes in the Cairn CLO will total 60 million euros, a person familiar with the terms said last month, asking not to be identified because the transaction is private. CLOs are a type of collateralized debt obligation that pool high-yield, high-risk loans and slice them into securities of varying risk and return.

To contact the reporters on this story: Lisa Abramowicz in New York at; Esteban Duarte in Madrid at

To contact the editors responsible for this story: Faris Khan at; Paul Armstrong at

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