Overview
JMP Credit Advisors LLC currently manages approximately $750 million in credit assets through two collateralized loan obligations, or CLOs. Cratos CLO I, Ltd and Rosedale II, Ltd both invest primarily in senior secured, first lien corporate leveraged loans.
We originated the portfolio of corporate loans collateralizing Cratos CLO I and completed its securitization in May 2007, issuing $455 million of secured notes and retaining all $45 million of unsecured notes, or equity, in the vehicle. The portfolio is granular and diversified by industry and geography, with more than 180 unique obligors spanning most industries and regions in the U.S.
We acquired the management contract for Rosedale II in September 2010. Rosedale II is a $300 million securitization secured by over 170 different corporate leveraged loans. The acquisition significantly increased our assets under management, the depth of our credit team and our presence in the loan market.
Our investment philosophy for both CLOs is to balance risk and return trade-offs in such a way that we protect the security of the CLO note holders while maximizing the returns to the CLO equity owners. We do this by investing in the most high-quality loans with the most attractive yields.
We undertake a rigorous underwriting process to ensure that each loan investment has the appropriate credit fundamentals and fits well into one of our CLOs. We invest only in companies that have established and defensible business models, experienced and proven management teams and strong cash flows. We look for borrowers that have the size and wherewithal to withstand economic downturns and have diversified customer and supplier bases.