Our Insights

Mergermarket's latest report highlights the private debt market's growth and transformation, with a significant increase in assets under management (AUM) over the past decade. Direct lending remains strong, while new strategies like distressed debt and special situations diversify the market. The report emphasizes the need for better data and technology in portfolio management to navigate challenges and ensure future success in this competitive space.

Discover the surging demand for private credit among family offices. Dive deeper into this captivating topic and unveil the intriguing appetite that is fueling this trend.

The private debt market is experiencing strong inflows, with H1 2023 fundraising at $94.9 billion, on track for the 4th consecutive year above $200 billion. Despite a slowdown in direct lending origination, private lenders have filled the gap left by banks, gaining significant market share. Despite a decline in LBO activity, private debt managers are finding opportunities, particularly in the middle market, and are expanding into new areas like asset-backed finance.

Take a look at this fascinating analysis of the global recession conducted by Bain & Company. While it was conducted prior to the war in Gaza, the findings indicate a consistent decline in inflation across major economies.

Surging interest rates have led to an increase in bankruptcies, reminiscent of the financial crisis. However, despite warning signs such as mounting corporate debt and recession risks, junk bond risk premiums remain relatively low. This disconnect between spreads and fundamental insolvency risks is concerning, as investors seem to be overly focused on yield and not fully accounting for potential risks.

Private credit has experienced explosive growth, with assets under management tripling to over $1 trillion globally since 2013. However, this rapid expansion presents challenges such as a dry powder dilemma, increased competition, and pressure to deploy capital. While private credit has been a high-flying asset class, its breakneck growth could become its Achilles heel, requiring fund managers to maintain discipline to avoid reckless lending behavior.

Guggenheim has recently released its quarterly report on Fixed Income Sector Views. The publication offers valuable insights into market trends, valuations, and investment opportunities across major fixed-income sectors. Read more to find out.

The financial services sector in Asia Pacific has shown resilience in the first half of 2023, thanks to a strong commitment to mid-market dealmaking. However, factors such as higher interest rates, inflation concerns, regulatory scrutiny, and economic slowdown fears have impacted M&A activity. Despite China's economic slowdown, Southeast Asian markets are driving growth through strategic deals. Read more to find out.

For private credit, the upcoming two years will witness a significant shift towards digitalization, placing emphasis on cybersecurity, thorough due diligence, and seamless investor onboarding. Dig deeper to find out more.

Q4 2023 risks facing markets include high inflation, aggressive rate hikes, underinvestment in oil, economic troubles in China, dropping housing activity in the US, volatility due to the strong dollar, an uncertain winter in Europe, and global growth losing steam as central banks tighten policy. Find out more..