Private credit

It’s been lauded as anything from a ‘”short-term fad” to the next great diversifier, but while private credit polarises investors it continues to provide robust, stable returns. Are private credit managers good enough to maintain their rapid ascension in the private capital arena?

While private credit is experiencing growing pains in some major markets, its rise continues apace back home with Regal Partners making another significant acquisition in the sector.

Private credit has seen huge inflows in recent years, but contrary to the claims made by some of its advocates it’s not a defensive asset class or a substitute for investment grade corporate and sovereign bonds.

Senior secured loans recover strongly from economic downturns and plenty of corporates are well prepared for any ructions ahead. Still, active management matters when it comes to selecting new deals.

There’s still ample opportunity for loans generate higher than historical average returns, with Invesco expecting outperformance over the next 6-12 months. And with a recession potentially on the horizon they come with downside protection included.

The mid-market private manager’s co-founding partner, Mick Wright-Smith, expounds on the biggest red flag borrowers can wave, as well as the lending advice he’d like to give to his younger self.

The proliferation of private credit providers in recent years is a boon for investors, explains Andrew Ash from Mason Stevens. But the attraction of diversification and returns comes with several caveats that investors should consider.

Two years after the launch of its inaugural direct lending fund, Epsilon have forged a partnership with a prominent multi-office family to debut a new low correlation private credit fund.

Private lending is going mainstream as soaring inflation forces mid-market businesses to consider more flexible funding options than the traditional incumbent sources.

David Ross from Northleaf Capital Partners shares insights with James Dunn from The Inside Network on what is driving growth in private credit.