Investment giants are behind the recent increase in direct lending, with Ares Management and Blackstone deploying more than half of the market’s capital between them.
According to a new report from the Alternative Credit Council, approximately 58 per cent of the total capital deployed by private credit managers globally has come from firms which lend more than $10bn (£8.05bn) per year.
The report found that private credit managers deployed an estimated $333bn during 2022 – a significant increase from the estimated $200bn that was deployed in 2021.
The Alternative Credit Council noted that private credit lenders are also becoming active in other markets such as large cap lending, non-sponsored debt, real estate and asset-backed lending, demonstrating the rapid growth of the sector.
“Our research shows several larger firms continue to play a significant role in the corporate lending markets,” the report read.
“The scale of these strategies naturally draws significant attention – and rightly so – however, the story of private credit continues to move beyond corporate lending.
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“In line with previous predictions of this research series we also see greater interest among investors in opportunities such as real estate debt, asset backed lending, infrastructure and trade finance.
“It is likely that in 2024 these strategies will continue to act as additional growth engines for the asset class.”
Earlier this week, it was revealed that Blackstone plans to borrow just under $400m through a collateralised loan obligation to bolster its $52bn flagship private credit fund. Bloomberg reported that Blackstone has also raised $8bn from institutional investors in the first close of a fresh direct lending fundraise.
Meanwhile, Oaktree Capital Management is believed to be in the process of raising $18bn to launch the largest ever private credit fund.