The Barings Australian Private Credit Fund and Barings Developed Asia Pacific Private Loan Fund 1A have launched with an aggregate amount of $690 million.
The Australian Private Credit Fund is an open-ended private credit solution that leverages Barings’ capabilities in Australia and New Zealand, and aims to provide attractive returns through current income and capital appreciation. This will be by investing in directly originated loans to private middle-market companies in Australia and New Zealand.
This is suited to institutional and wholesale investors who are searching immediate exposure to private credit with attractive yield potential.
It has already been seeded with $230 million by a global investment multimanager.
The second fund – Developed Asia Pacific Private Loan Fund 1A – is a closed-ended fund anchored by an Asian institutional investor.
Justin Hooley, managing director of Barings’ Asia Pacific Private Finance Group, said: “We believe that the Australian private credit market is attractive due to its stable economic and legal backdrop, and it has significant potential for further growth in the years ahead.
“We continue to identify numerous opportunities in the Australian private credit market as a result of our market position and the opportunities that derive from our current portfolio, despite the fact that there has been a decrease in M&A activity. As one of the most active lenders in the region with over 13 years of track record and a diversified portfolio, we are well-positioned to capitalise on the compelling opportunity.”
The Barings Asia Pacific Private Finance Group focuses on Singapore, Hong Kong, Australia and New Zealand, and has deployed over $5.8 billion.
Research by Schroders last month found 51 per cent of Asia-Pacific financial advisers and wealth managers expect to increase their clients’ private equity allocations in the next two years, and 40 per cent expect to increase allocations to private debt.
Shane Forster, APAC head of investment management, said: “The Asia-Pacific private credit market is rapidly evolving into an appealing opportunity for investors. It exhibits comparable attributes to private credit in North America and Europe, including exposure to high-quality borrowers, but with less competition for lending opportunities, geographical diversification and exposure to expanding developed economies such as Australia, New Zealand, Hong Kong and Singapore.”
