What is private credit?

Private credit covers several strategies: senior direct lending, unitranche, mezzanine, distressed and special situations. Loans are usually negotiated with one lender or a small group and often carry covenants. Vehicles include closed-end funds, BDCs, evergreen funds and SMAs. It is often confused with broadly syndicated loans, which are arranged by banks and traded.

Say a $1 billion credit fund lends directly to mid-sized companies at floating interest rates, holds the loans to maturity, and returns the interest to its investors.

It has grown fast as banks pulled back, which is why regulators and investors watch it closely.

• M&G launches £74m private credit LTAF for DC savers
  Fundraising · $94M · LaunchAlternative Credit Investor +1Oct 12
• Vivriti Asset Management aiming for first close of Rs 2,500 crore private credit fund this quarter
  Fundraising · $300M · First closeMoneycontrol.comOct 9
• SEC Staff Statement Highlights Valuation and Disclosure Expectations for Private Credit and Other Illiquid Assets
  RegulationJD SupraOct 9
• BlueOrchard, IFC launch private debt vehicle with $300m first close
  Fundraising · $300M · First closeAfrica Private Equity NewsOct 9
• Anne Arundel County slates $60 million for open-end direct lending fund
  LPsPensions & InvestmentsOct 9
• BlueOrchard and IFC target $2bn for EM private debt fund
  Fundraising · $2B · First closeAlternative Credit InvestorOct 9