Japanese CDO Market Experienced Decreased Action Last Year.(collateralized debt obligations)

With the finalized numbers now in, it appears the market for collateralized debt obligations (CDOs) in Japan cooled its heels when it came to new issuance last year.

Moody's Investors Service said that 20 Japanese CDOs were rated in 2004 for a total volume of 0.72 trillion. This was a dramatic drop in issuance, as Moody's rated 4.24 trillion of Japanese CDOs in 2003.

Analysts said the drop in the average size of CDOs was due, in part, to a decrease in the number of balance-sheet CDOs by financial institutions targeting portfolio risk management plays. This coupled with an increase in primary collateralized loan obligations (CLOs) and collateralized bond …