Global Collateralized Debt Obligation Market Growth (Status and Outlook) 2024-2030
The global Collateralized Debt Obligation market size was valued at US$ 128,050 million in 2023. With growing demand in the downstream market, collateralized debt obligations are f
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Introduction
A collateralized debt obligation (CDO) is a type of structured asset-backed security (ABS). Originally developed for the corporate debt markets, over time CDOs evolved to encompass the mortgage and mortgage-backed security ("MBS") markets.
Market Insights
According to the Publishers’ latest study, the global Collateralized Debt Obligation market size was valued at US$ 128050 million in 2023. With growing demand in downstream market, the Collateralized Debt Obligation is forecast to a readjusted size of US$ 169030 million by 2030 with a CAGR of 4.0% during review period.
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Citigroup, Credit Suisse, Morgan Stanley, J.P. Morgan and Wells Fargo are the leaders of the Collateralized Debt Obligation industry, which take about 50% market share. North America is the major region of the global market, which takes about 50% market share.
Key Features:
The report on Collateralized Debt Obligation market reflects various aspects and provide valuable insights into the industry.
Trends:
Increased Regulatory Oversight: Following the 2008 financial crisis, there has been a significant increase in regulatory scrutiny and oversight of the CDO market, with measures aimed at enhancing transparency, risk management, and investor protection.
Shift Towards Simpler and More Transparent Structures: In response to the increased regulatory requirements and public scrutiny, the CDO market has seen a shift towards simpler and more transparent structures, with a focus on improving the understanding of the underlying assets and risk profiles.
Growth in Synthetic CDOs: While the traditional cash-based CDO market has seen a decline, the market for synthetic CDOs, which reference credit default swaps (CDS) rather than physical assets, has experienced relatively stronger growth.
Diversification of Underlying Assets: CDO issuers have diversified the underlying assets beyond traditional mortgage-backed securities, including corporate loans, asset-backed securities, and even infrastructure project financing.
Increased Institutional Investor Participation: The CDO market has seen a shift towards greater participation from institutional investors, such as insurance companies, pension funds, and asset managers, attracted by the potential yield and diversification benefits.
Drivers:
Demand for Yield Enhancement: In a low-interest-rate environment, investors are seeking higher-yielding investment opportunities, which has led to a continued demand for CDOs and other structured credit products.
Need for Portfolio Diversification: CDOs can provide investors with exposure to a diversified pool of assets, which can help to enhance the risk-adjusted returns of investment portfolios.
Innovation in Structured Finance: Financial institutions continue to develop new and more sophisticated CDO structures to meet the evolving needs of investors and the changing regulatory landscape.
Growth in Emerging Markets: Increasing economic growth and the development of financial markets in emerging economies have created demand for structured credit products, including CDOs.
Securitization of Illiquid Assets: CDOs provide a mechanism for the securitization of illiquid assets, such as loans and receivables, which can improve liquidity and access to capital for originators.
Opportunities:
Expansion into New Asset Classes: As the market evolves, there may be opportunities to expand the CDO structure to new asset classes, such as infrastructure projects, renewable energy, and private equity investments.
Increased Participation from Institutional Investors: The growing demand for yield enhancement and portfolio diversification from institutional investors, such as insurance companies and pension funds, can drive the growth of the CDO market.
Regulatory Developments: Changes in regulatory frameworks, such as the implementation of new risk-based capital requirements, may create opportunities for innovative CDO structures that can help financial institutions manage their regulatory compliance.
Technological Advancements: The adoption of advanced data analytics, artificial intelligence, and blockchain technology can enhance the transparency, risk management, and efficiency of the CDO market.
Emerging Market Growth: The continued economic growth and the development of financial markets in emerging economies can create new opportunities for CDO issuance and investment.
Threats:
Regulatory Tightening: Increased regulatory scrutiny and stricter capital requirements may limit the ability of financial institutions to originate and securitize certain types of assets, thereby constraining the CDO market.
Reputation Risk: The historical association of CDOs with the 2008 financial crisis has led to a lingering reputational risk, which may make it challenging for the industry to regain investor confidence.
Complexity and Lack of Transparency: The inherent complexity of CDO structures and the potential for opacity in the underlying assets can make it difficult for investors to fully understand and assess the risks involved.
Competition from Alternative Investment Products: The CDO market faces competition from other structured credit products, such as collateralized loan obligations (CLOs) and asset-backed securities, which may offer similar risk-return profiles.
Concentration Risk: The CDO market may be vulnerable to concentration risk, as a significant portion of the market can be dominated by a few large players or rely heavily on a limited set of underlying assets.
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Manmayi Raval
Research Consultant
Market Size and Growth: The research report provides an overview of the current size and growth of the Collateralized Debt Obligation market. It may include historical data, market segmentation by Type (e.g., Collateralized loan obligations (CLOs), Collateralized bond obligations (CBOs)), and regional breakdowns.
Competitive Landscape: The research report provides analysis of the competitive landscape within the Collateralized Debt Obligation market. It includes profiles of key players, their market share, strategies, and product offerings. The report can also highlight emerging players and their potential impact on the market.
Government Policies and Incentives: The research report analyse the impact of government policies and incentives on the Collateralized Debt Obligation market. This may include an assessment of regulatory frameworks, subsidies, tax incentives, and other measures aimed at promoting Collateralized Debt Obligation market. The report also evaluates the effectiveness of these policies in driving market growth.
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Market Forecasts and Future Outlook: The CDO market will continue to face significant challenges, such as the lingering reputational risk, competition from alternative investment products, and the potential for regulatory tightening. The industry's ability to adapt to these challenges and capitalize on the emerging opportunities will be crucial in shaping the future of the global CDO market.
Market Segmentation:
Collateralized Debt Obligation market is split by Type and by Application. For the period 2019-2030, the growth among segments provides accurate calculations and forecasts for consumption value by Type, and by Application in terms of value.
Segmentation by type
Collateralized loan obligations (CLOs)
Collateralized bond obligations (CBOs)
Collateralized synthetic obligations (CSOs)
Structured finance CDOs (SFCDOs)
Segmentation by application
Asset Management Company
Fund Company
Others
This report also splits the market by region:
Americas
United States
Canada
Mexico
Brazil
APAC
China
Japan
Korea
Southeast Asia
India
Australia
Europe
Germany
France
UK
Italy
Russia
Middle East & Africa
Egypt
South Africa
Israel
Turkey
GCC Countries
The below companies that are profiled have been selected based on inputs gathered from primary experts and analyzing the company's coverage, product portfolio, its market penetration.
Citigroup
Credit Suisse
Morgan Stanley
J.P. Morgan
Wells Fargo
Bank of America
BNP Paribas
Natixis
Goldman Sachs
GreensLedge
Deutsche Bank
Barclays
Jefferies
MUFG
RBC Capital
UBS
Table of Contents
1 Scope of the Report
1.1 Market Introduction
1.2 Years Considered
1.3 Research Objectives
1.4 Market Research Methodology
1.5 Research Process and Data Source
1.6 Economic Indicators
1.7 Currency Considered
1.8 Market Estimation Caveats
2 Executive Summary
2.1 World Market Overview
2.1.1 Global Collateralized Debt Obligation Market Size 2019-2030
2.1.2 Collateralized Debt Obligation Market Size CAGR by Region 2019 VS 2023 VS 2030
2.2 Collateralized Debt Obligation Segment by Type
2.2.1 Collateralized loan obligations (CLOs)
2.2.2 Collateralized bond obligations (CBOs)
2.2.3 Collateralized synthetic obligations (CSOs)
2.2.4 Structured finance CDOs (SFCDOs)
2.3 Collateralized Debt Obligation Market Size by Type
2.3.1 Collateralized Debt Obligation Market Size CAGR by Type (2019 VS 2023 VS 2030)
2.3.2 Global Collateralized Debt Obligation Market Size Market Share by Type (2019-2024)
2.4 Collateralized Debt Obligation Segment by Application
2.4.1 Asset Management Company
2.4.2 Fund Company
2.4.3 Others
2.5 Collateralized Debt Obligation Market Size by Application
2.5.1 Collateralized Debt Obligation Market Size CAGR by Application (2019 VS 2023 VS 2030)
2.5.2 Global Collateralized Debt Obligation Market Size Market Share by Application (2019-2024)
3 Collateralized Debt Obligation Market Size by Player
3.1 Collateralized Debt Obligation Market Size Market Share by Players
3.1.1 Global Collateralized Debt Obligation Revenue by Players (2019-2024)
3.1.2 Global Collateralized Debt Obligation Revenue Market Share by Players (2019-2024)
3.2 Global Collateralized Debt Obligation Key Players Head office and Products Offered
3.3 Market Concentration Rate Analysis
3.3.1 Competition Landscape Analysis
3.3.2 Concentration Ratio (CR3, CR5 and CR10) & (2022-2024)
3.4 New Products and Potential Entrants
3.5 Mergers & Acquisitions, Expansion
4 Collateralized Debt Obligation by Regions
4.1 Collateralized Debt Obligation Market Size by Regions (2019-2024)
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