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fund financing

Under the hood
PEI caught up with Fi Dinh, who led ING's first ESG-linked revolving credit facility, to discuss fund terms, interest rate calculations and sustainability targets.
ESG sustainability
The bank provided a subscription credit facility for Singapore's Quadria Capital that pegs its interest rate to fund-level ESG performance.
Charts
Credit lines are contentious but their ability to improve IRR appears limited to the most strongly performing funds and funds early in their life, writes Christoph Jäckel of Montana Capital Partners.
Copenhagen Denmark
ATP PEP will ask GPs to provide an IRR that has been adjusted to compensate for the use of subscription credit lines, managing partner Torben Vangstrup told PEI.
GPs must think carefully about how fund level leverage affects performance at the fund level and by extension, their own stability.
money
The bank's secondaries advisory group has teamed up with its fund financing unit and has executed around 20 private equity loans over the last two years.
Time
TPG veteran Ben Gray’s firm is understood to be using credit lines to avoid fee-drag on Australia’s largest first-time fund.
Credit shops have traditionally avoided the strategy, but innovative new opportunities are luring them to carve a niche for themselves
Comments from one of the US's largest pension plans are a reminder that the debate around credit lines is not settled.
The use of facilities is so ingrained in the private equity industry that nothing short of an extreme event can turn back the tide.
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