Alcentra predicts rise in private credit earnings due to climate exposure

Alcentra has predicted that it could see an increase to its private credit earnings by 2050 as a result of its climate exposure.

In a new report, the global alternative credit asset manager – which is part of Franklin Templeton – said that by 2030, it is expected to have “moderate climate exposure” that could impact its portfolios.

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“By 2050, Special Situations may be negatively impacted, while Liquid Credit and Private Credit could see earnings increase,” it said in the report.

Alcentra said it is proactively taking actions to try to “manage transition risks, deliver on our decarbonisation commitments, and support a just transition to a net zero economy.”

Read more: Climate change: How investors can take action

“Our proactive approach in adopting market-leading frameworks, engaging in stewardship, and advocating for improved market standards reflects our dedication to addressing the systemic risks posed by climate change,” the firm added.

Private credit is expected to play a “pivotal role” in financing the climate transition, according to a recent report from Goldman Sachs.

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