LONDON–(BUSINESS WIRE)–#creditratingagency–KBRA UK (KBRA) assigns preliminary ratings to six classes of notes and one of loan issued by Barings Euro Middle Market CLO 2025-1 DAC, a cash flow collateralized loan obligation (CLO) backed by a diversified portfolio of middle market corporate loans. This transaction is the first publicly rated, multicurrency European middle market CLO.
Barings Euro Middle Market CLO 2025-1 DAC is managed by Barings (U.K.) Limited (“Barings” or the “collateral manager”) and will have a 4.6-year reinvestment period. The ratings reflect initial credit enhancement levels, excess spread, and coverage tests including overcollateralisation ratio and interest coverage tests.
The collateral in Barings Euro Middle Market CLO 2025-1 DAC will mainly consist of middle market loans issued by corporate obligors diversified across sectors. The total portfolio par amount is €400 million with exposure to 67 obligors. The obligors in the portfolio have a K-WARF of 3110, which represents a weighted average portfolio credit assessment of approximately B-.
Barings (U.K.) is a wholly owned subsidiary of Barings Europe Limited, which forms part of the global Barings LLC group headquartered in Charlotte, North Carolina, U.S.A. Barings’ Global CLO platform, established in 1998, is among the most experienced in the market, with over 100 CLOs issued and approximately $32.8 billion in structured credit AUM as of June 2025. The firm is an active issuer across the U.S., European, and private credit CLO markets, supported by a dedicated team of more than 60 CLO investment professionals. Barings is also a significant investor in CLO tranches globally, aligning its interests with those of third-party investors and its parent, MassMutual, which provides permanent capital backing to the platform.
Class A-1, B, C, D, and E Notes and Class A-1 Loan are denominated in Euro while Class A-2 notes are dominated in GBP sterling. The preliminary ratings on the Class A-1, A-2, and B Notes and Class A-1 Loan consider the timely payment of interest and the ultimate payment of principal by the applicable legal final maturity date, while the preliminary ratings on the Class C, D, and E Notes consider the ultimate payment of interest and principal by the applicable legal final maturity date.
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Methodologies
- Structured Credit: Structured Credit Global Rating Methodology
- Structured Finance: Global Structured Finance Counterparty Methodology
- ESG Global Rating Methodology
Disclosures
Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.
A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be located here.
This credit rating is endorsed by Kroll Bond Rating Agency Europe Limited for use in the European Union. Information on a credit rating’s endorsement status is available on its rating page at KBRA.com.
Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.
There are certain issuers, entities or transactions rated by KBRA Europe or KBRA UK that may be or have relationships with Shareholders and/or Shareholder-Related Companies, as that term is defined in KBRA’s Shareholder and Shareholder Related Companies for KBRA Europe and KBRA UK Policy and Procedure. Relevant disclosure information may be found here.
About KBRA UK
Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S. Kroll Bond Rating Agency UK is located at 1 Connaught Place, 2nd Floor London, England.
Doc ID: 1011964
Contacts
Analytical Contacts
Gabriele Gramazio, Senior Director (Lead Analyst)
+44 20 8148 1001
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HyunKyeong Kim, Associate Director
+1 646-731-2459
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John Hogan, Co-Head of Europe, Ratings General
+353 1 588 1191
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Eric Hudson, Senior Managing Director, Co-Head of Global Structured Credit (Rating Committee Chair)
+1 646-731-3320
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Business Development Contacts
Miten Amin, Managing Director
+44 20 8148 1002
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Mauricio Noé, Co-Head of Europe
+44 20 8148 1010
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