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Citigroup Is Trying to Take CLO Trading Out of the 1990s

  • Firm introduced electronic bidding platform for CLO market
  • Bank says platform has already helped it gain market share
A man walks past Citigroup Inc. offices in New York.
Photographer: Victor J. Blue/Bloomberg
Updated on

When Brian Bejile joined Citigroup Inc.’s collateralized loan obligation unit 15 years ago, clients mainly placed their orders by phone.

Not much has changed, even as the market for CLOs has ballooned to about $600 billion and regulators have grown concerned about its possible excesses. When investors auction off CLOs they own to other money managers, it’s still a largely manual process with the dealer that manages the sale collecting orders by phone or through chat rooms. A customer’s chance of actually winning a piece of a CLO auction is usually less than 10%, Bejile said.