Executive Summary

Private credit has become a core part of the global financing ecosystem, but as the market has scaled, so too have the questions around its structure, resilience and long-term return profile.

This paper steps back from the noise to provide a balanced, practitioner-led view of the asset class today, highlighting both the strengths that underpin its growth and the structural risks that are beginning to emerge.

At its core, our view is simple:

Private credit remains an important and attractive asset class, but outcomes will increasingly depend on discipline, structuring and the ability to operate across both public and private markets.

Key characteristics

• Private credit plays a critical role in global markets, offering flexibility to borrowers and attractive risk-adjusted returns to investors
• Structural risks are emerging, driven by capital inflows, weaker underwriting and pro-cyclical behaviour
• Default and loss expectations are likely to increase from historically low levels
• The most resilient strategies will combine discipline, flexibility and cross-market insight
• Managers who operate across both public and private credit are best positioned going forward