The Misnomer of CLL Equity

In the past, when you were buying at par, that ability to call or essentially liquidate the portfolio in a few years wasn't as valuable. And similarly, if interest rates were very low and you weren't expecting them to go down further, again, not as valuable as the situation we're seeing now. So CLL equity got its name because really it is the capital in the deal. We call CLL equity, however, the legal term is subordinated notes.