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The non-public debt secondary market will see elevated deal move and decrease reductions this yr, a brand new survey has concluded.
Ely Place Companions’ newest Non-public Debt Secondary Market Survey discovered that the yr forward will see a “giant progress in quantity” and amount of offers, because the sector matures.
Elevated competitors and a stabilising economic system may additionally result in larger pricing, the survey discovered.
Learn extra: Rising ‘bifurcation’ of high quality in center market non-public credit score
Deal quantity is predicted to extend by between 50 and 100 per cent this yr, with as much as $15bn (£11.96bn) of closed transactions predicted.
Ely Place Companions discovered that high-quality senior loans could be notably standard this yr, with LPs driving the overwhelming majority of those offers. Pensions funds are anticipated to be the biggest sellers.
“Non-public debt secondary offers have been rising steadily in measurement and quantity over the previous twelve months,” stated Daniel Roddick, founder at Ely Place Companions.
“The institution of a devoted purchaser universe has given LPs confidence to deliver giant portfolios to market.
“On the identical time, GPs are proactively benefiting from the market to speed up liquidity for his or her traders.”
Learn extra: Advisers look to reallocate from public fastened earnings to personal credit score
The survey requested quite a lot of specialist traders for his or her views on the state of the non-public debt secondary market, with some respondents providing far more optimistic predictions.
One acknowledged that the non-public debt market will develop to between $2tn and $2.5tn this yr, with one to 1.5 per cent of that altering palms within the secondary market.
One other investor predicted that deal move for 2024 could possibly be as excessive as $50bn.
Learn extra: Direct lending’s resilience “shall be examined”
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