Quarterly CLO Test Results

RNS Number : 7421B

Greenwich Loan Income Fund Ltd

20 April 2012

 



Greenwich Loan Income Fund Limited ("GLIF" or the "Company")

Quarterly CLO Test Results

The Company announces the test results as of 2 April 2012 pursuant to the indenture of T2 Income Fund CLO I Ltd (the "CLO"), of which the Company owns all of the residual economic interest. The report summarising the results of those tests can be found at the link below:

http://www.rns-pdf.londonstockexchange.com/rns/7421B_-2012-4-20.pdf 

With respect to the various tests required under the CLO indenture, the CLO passed all of the collateral and coverage tests as of 2 April 2012, but failed one portfolio percentage limitation test, which relates to the minimum percentage requirement for senior secured loans, as the CLO received scheduled amortizations, prepayments and sales proceeds of approximately US$22.2 million during the quarter, and cash balances have the effect of reducing the percentage of invested funds for purposes of the portfolio percentage limitation test. The available cash balance is being reinvested which, to the extent invested in senior secured loans, will address the test requirement.  It should be noted that the consequence of failing this percentage limitation test is that each new investment made by the CLO must "maintain or improve" the test result. 

The quarterly results indicate that the CLO met all of the covenant tests necessary for a full payment to be made to the Company, and approximately US$3.5 million has been received from the trustee. We note that this is the highest quarterly payment received from the CLO since its inception.

As described in previous press releases, the CLO indenture contains a variety of covenants, compliance with which could be made more difficult or impossible should credit markets deteriorate or the loans held by the CLO fail to make expected payments or otherwise not perform, or for a variety of other reasons, and which if violated could result in additional principal paydowns of the CLO's notes and/or interest diversion.  

Contacts:

Geoffrey Miller

Greenwich Loan Income Fund Limited

[phone]

Patrick Conroy
Greenwich Loan Income Fund Limited
[phone]

Investec Bank plc

Hugh Field

Jeremy Ellis     

[phone]

Ed Gascoigne Pees

Financial Dynamics

[phone]

 

END

 

 

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