Private credit : An investment opportunity but also a path to regional growth
Singapore’s increased investment in private credit shows the city is embracing alternative investments and more complex financial services. As international investors warm to Southeast Asia at a time of growing geopolitical uncertainty, Singapore has a real opportunity to increase its share of global capital flows and drive growth.
RAVI Menon, managing director of the Monetary Authority of Singapore (MAS), laid out the case for an increased allocation to private markets during a keynote speech at the SuperReturn Asia conference in September.
“Private equity (PE) and venture capital (VC) managers are more nimble than investors in public markets,” he said. “Compared to public equity investment managers, PE and VC managers typically have more control and influence over their portfolio companies, and greater access to information on their financial and sustainability performance.”
This advantage of private over public investors also holds true for alternative credit managers and is reflected by increasing allocations to private credit strategies by institutional investors such as pension funds and insurance companies. The MAS is among these investors; Menon also announced an additional US$1 billion investment in private credit, taking MAS’ private markets programme to US$6 billion.
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