KBRA Releases Research – Private Credit: CFO Growth and Performance

KBRA releases research on collateralized fund obligations (CFO), discussing their typical structure and common credit protections.

CFOs are specialized financial vehicles collateralized by the cash flows from a diversified pool of private capital assets—primarily limited partner interests and sometimes co-investments or secondary market fund positions—in multiple private capital funds. They are typically structured as special-purpose vehicles that issue one or more debt tranches alongside an equity tranche, attracting fixed-income investors with varying risk-return preferences. Although CFOs have been in existence since the early 2000s, issuance has picked up significantly in recent years. Between 2018 and 2024, KBRA assigned ratings to 152 tranches in 67 CFOs, totaling approximately $37.7 billion of issuance, which included $28.5 billion of rated debt with the remainder in equity or unrated debt.

This report also explores analytical observations related to KBRA-rated CFOs, issuance volume, and structural trends, as well as rating performance since inception.

Click here to view the report.

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About KBRA

KBRA, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada. As a full-service credit rating agency, investors can use KBRA ratings for regulatory capital purposes in multiple jurisdictions.

Doc ID: 1008545

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