Private credit

January Capital’s private credit fund marks final close at over US$130 million

The fund offers growth-stage, sponsor-backed tech firms in Apac less-dilutive financing through senior secured loans

The prospect of lower income could spur funds to take on higher risk. S&P Global has warned of an “alarming surge in selective defaults”.
THINKING ALOUD

Tread carefully in private credit

The surge of funds into this asset class, exceeding the opportunities to deploy it for high returns, points to dwindling returns

The bulk of capital deployment in the private credit space has come from heavyweights with the resources to finance larger transactions.

Private credit hit deployment record last year: Alternative Credit Council report

Allocated capital swells to US$592.8 billion in 2024, a 78% year-on-year increase from US$333.4 billion the previous year

The idea of committing capital for five to seven years without an exit option feels uncomfortable to many.
INSIGHTS FROM CFA SOCIETY SINGAPORE

Private credit needs a secondary market

Such markets address illiquidity fears known to plague investors in Singapore and the Asia-Pacific

The market for private credit is an estimated US$40 trillion. It is a big engine for the economy that fuels innovation, growth and the industrial renaissance.

Private-credit fears are based on four myths

The growth of private credit in all forms has actually made our financial system more resilient and less concentrated

BlackRock’s move to recycle capital from its APCO II fund comes after it paused fundraising for a planned third Asian private credit strategy earlier this year.

BlackRock seeks one more year to deploy Asia private credit fund

The asset manager seeks more time for APCO II as it moves to deploy about 40% of the portfolio

Some ultra-wealthy individuals are curbing AI bets, however, amid concerns over booming valuations that have turned Nvidia into the world’s most valuable company.

Asia tycoon backs US$1.5 billion AI bet with private credit fund

Koo Sr is a fourth-generation member of the Koo dynasty and controls a stake worth more than US$400 million in Chailease

Apac is in the midst of one of its strongest corporate expansion cycles in decades. Demand for capital is intensifying.

Asian private credit – an attractive risk-reward opportunity

While such deals in region need structuring expertise and local insight, they also offer better yields with protections not commonly found in West