Fund Finance

The fall of three major lenders to private equity GP borrowers across the AUM spectrum means sub lines may be harder to get for some; and yet, the market has already begun to adapt.

Scratching your head at how to make sense of current market dynamics? You're not alone.

A confluence of market events are fuelling growth in the demand for NAV and hybrid facilities, write lawyers from Reed Smith.

Ratings could broaden investor base, and may open the door to a future capital markets solution for the fund instruments.

Some sponsors are in liquidity binds because they must wait longer to get carry.

In a trickier exit environment, fund managers may be forced to embrace longer hold periods.

Why? Because lower returns will be a temporary phenomenon and because private equity has operated in a much higher interest rate environment before, according to industry participants.

Banks hitting concentration limits and syndicating deals, insurance companies coming in as both buyers and lenders, and even rising interest rates all point to a bigger slice of market for non-banks.

A considerable drop in the number of capital calls made by private capital funds comes as no surprise to those in the asset class, as managers have increasingly been looking to subscription lines to simplify investments.