Senior secured private debt in Australia and New Zealand has been on the rise among institutional and sophisticated investors looking for relative value for their asset allocation mix, according to Revolution Asset Management. The growth was driven mostly by a number of macro-economic tailwinds, with the most substantial being changes to bank regulations.
Revolution’s chief investment officer, Bob Sahota, explained that due to increased capital adequacy requirements, there was a consistent decline by Australian banks in lending to a number of key private debt sectors, which created a financing gap in Australia and an emerging opportunity for non-bank lenders.