Asset owners turn to private credit in quest for returns
Top funds nearly double their allocations to asset class despite high risk potential
Nimisha Srivastava said manager selection will be very important to earning the desperately needed yield.
U.S. institutional investors are betting big that private credit will provide much-needed yield and an illiquidity premium to public debt, with assets nearly doubling in the year ended Sept. 30.
Private credit assets of the largest 200 U.S. retirement plans nearly doubled, up 93.1% to $50.2 billion in the year ended Sept. 30. It is also a 212% increase from 2018, when
Pensions & Investments first included private credit in its annual survey of the largest retirement plans.
As we’ll discuss shortly, Apollo had commissioned an whitewash investigation by law firm Dechert to reassure investors that nothing too unsavory had happened, and get them to stop their capital strike against the giant fund. However, the Financial Times reported yesterday that the UN’s pension fund is keeping Apollo on a watch list and the Pennsylvania Public School Employees Retirement System is sticking to its guns: From the Financial Times:
A report by lawyers for Apollo Global Management into the ties between Leon Black and the late paedophile Jeffrey Epstein is “not enough” to remove the company from a watch list of investments that require extra scrutiny, a top UN pension fund official has said…
The announcement came as Apollo revealed the conclusion of a review by law firm Dechert into Mr Black’s relationship with the late paedophile Jeffrey Epstein.
Leon Black will be stepping down as CEO of Apollo Global Management
His resignation comes after an internal probe found no wrongdoing in his past relationship with convicted sex offender Jeffrey Epstein
However, the investigation did find that Black paid Epstein $148million in advisory fees and donated $10million to Epstein’s charity
But it was previously reported that Black transferred between $50million and $75million to Epstein for professional services
Black will still remain with the company as chairman, Apollo said Thursday
Leon Black: A Career-Making 1990 Call and a Career-Ending One in the 2010s
He owes Apollo’s boffo start to the killing he made on an insurer’s then-skanky high-yield bonds
. Then came Epstein.
Apollo Global Management CEO Leon Black
Leon Black, who three decades ago launched his storied career as a private equity kingpin due to one great judgment call, is giving up that exalted position because of another call, a really questionable one.
An alumnus of defunct junk bond powerhouse Drexel Burnham Lambert, Black in 1990 cannily secured a stash of Drexel’s high-yield paper and turned it into a fortune. He’s now ranked No. 55 on the Forbes 400 list of richest Americans, with an estimated net worth of $8.7 billion.