Finance
Private Equity’s Favorite Borrowing Tool Sparks Fresh Scrutiny
- UK said to ask banks for more detail about NAV loan portfolios
- NAV lending has surged amid a dearth of private equity-deals
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UK regulators are scrutinizing how some of the world’s biggest banks help private equity firms layer on debt, prying into a controversial corner of the $8.2 trillion buyout industry.
The Prudential Regulation Authority has asked banks to provide more information about their offering of net-asset-value loans to buyout funds, according to people with knowledge of the matter. It’s asked some lenders how much capital they have dedicated to the effort and how much leverage they’ve offered to fund managers for these loans, the people said.