When Markets Turn: Why Speed Kills in a Credit Crisis

Semeris City

The Asset Backed Alert from Green Street reports that CLO issuance has been deeply affected by market volatility - Oil, tariffs, AI's SaaSpocalypse’, and geopolitical uncertainty have also likely contributed to a ~30% drop in Q1 leveraged loan volumes. It's the slowest start we've seen since 2020. Investor confidence has been rattled somewhat, and perhaps rightly so.

When market waters are calm, speed tends to beat rigor. Covenants stay loose, documentation gets templated, and basically everyone looks like a genius. But when markets turn, and storm clouds appear, credit committees suddenly want more scrutiny, not less. They want more sources reviewed, more documents verified, and more discrepancies caught before these turn into actual problems.

In many cases, document analysis and review workflows built during the good years were designed more for volume than for depth. This gap between what the market demands now and what existing processes can actually deliver, this is where things get interesting. Where losses are avoided and where alpha gets created. And winners get separated from losers. Semeris can help you close that gap.

The CLO managers and investors who best navigate this challenging environment won't necessarily be the ones with the most clever army of analysts. They'll be the ones whose analysts spend more time on actual analysis and decision-making and less time trying to just find the information they need for that. Ctrl-F anyone?

So the question that seems worth asking right now is how much of your team's time is actually spent getting to the analysis, rather than doing the analysis itself?