Private Credit

Income by contract, not by hope.

Lending directly to established private businesses in return for contractual interest, senior in the capital structure and secured where possible.

Strategy

The lender's seat has advantages worth owning.

Since banks retreated from mid-market lending, private credit has grown into a substantial asset class. It offers what equity cannot: income defined by contract, a senior claim on a borrower's cash flows, and, frequently, security over its assets.

For patient capital willing to accept illiquidity, that combination has produced attractive, resilient income. It is not without risk, borrowers can and do default, but a well-diversified, well-underwritten book of loans behaves very differently from a portfolio of equities.

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Senior

Typically ranks ahead of equity in the capital structure

Floating

Income that often rises with interest rates

Contractual

Returns defined by loan terms, not market sentiment

4-7yr

Typical horizon for a private credit strategy

Underwritten loan by loan.

How we access it

Three routes to private income.

Direct lending

Senior secured loans to established mid-market companies, usually to fund growth or acquisitions, with covenants that protect the lender.

Specialty finance

Lending against specific, diversified pools of assets, such as receivables or equipment, with income drawn from many small obligors.

Opportunistic credit

Selective exposure to more complex or dislocated situations, where skilled managers are paid well for solving difficult problems.

Why allocate

Income that behaves.

Private credit is held for its income and its resilience. Because most loans pay a floating rate, the income tends to rise as interest rates rise, a valuable characteristic when other bonds fall. The illustrative comparison below shows the role it can play.

Illustrative characteristics of a representative strategy, not a forecast. Capital is at risk and loans can default.

Share of return from income85%

Loans paying a floating rate90%

Senior secured share of book75%

Sensitivity to equity markets25%

Suitability & risk

What to weigh before allocating.

Illiquidity

Loans are held to maturity. Capital is committed for years and cannot be readily withdrawn.

Credit risk

Borrowers can default. Diversification across many loans, sectors and managers is essential.

Manager skill

Outcomes depend heavily on underwriting quality. Selection and diligence dominate returns.

Horizon

Best suited to investors who can commit capital for the medium to long term for the income it provides.

Questions

What clients ask us first.

How is private credit different from a bond fund?

A traditional bond fund holds tradable securities whose prices move daily with the market. Private credit holds illiquid loans, usually held to maturity, whose return comes primarily from contractual interest rather than price movement. This makes the income steadier but the capital far less liquid.

What protects me if a borrower struggles?

Most of the loans we favour are senior and secured, meaning they rank ahead of equity and other creditors and are backed by the borrower's assets. Covenants also give lenders rights to act early. None of this removes the risk of loss, but it materially improves the lender's position.

Why is the income often floating-rate?

Many private loans pay interest at a margin above a floating reference rate. When rates rise, the income rises with them, which can make private credit a useful counterweight to fixed-rate bonds in a portfolio.

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Related capabilities.

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Consider an allocation to private credit.

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