Citigroup Said to Raise $612 Million CLO Loan Fund for Blackrock

Citigroup Inc. raised a $612 million collateralized loan obligation for BlackRock Inc., according to a person with knowledge of the deal.

The fund includes a $360 million slice rated AAA that pays a rate of 139 basis points more than the London interbank offered rate and a second $12 million piece with the same grade that pays 214 basis points more than the benchmark rate, said the person, who asked not to be identified because the terms are private. Libor is the rate at which banks say they can borrow in dollars from each other.

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.