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Investors Fleeing Negative Yields Fuel Private Debt Cash-Pile

  • Managers see increased demand for higher-yielding asset class
  • First-time investors swell direct lending fundraise: Barings

Investors seeking shelter from the sea of negative-yielding assets may provide a further boost to Europe’s direct lending market.

Private debt fund managers say the ultra low interest rate environment is set to drive more money into the business of lending to mid-sized companies. Fundraising for the strategy totaled $10.7 billion from January to June, according to research firm Preqin, and the second half of the year is off to a bumper start with several multi-billion-euro fundraisings already announced.