March 18, 2020 - In light of recent market conditions, the LSTA has received a number of inquiries whether CLOs will be forced to significantly liquidate their loan positions because of rating agency downgrades or continued downward pressure on loan prices.  The LSTA would like to stress that CLOs, which represent approximately 60 percent of the leveraged loan market, are long-term vehicles that are not marked to market.  Consequently, under the governing terms of market CLOs, neither ratings agency downgrades nor continued downward pressure on loan prices would force CLOs to sell loan assets or to liquidate a CLOs portfolio of individual loans.