Private Credit Taps Insurance Firms’ Trillions to Keep Growing
- Rated feeders are palatable, cheaper for risk-averse investors
- Apollo launches $5 billion fund with hallmarks of rated feeder
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The private credit industry is drawing closer to the trillions of dollars in insurance holdings it needs to keep growing.
Direct lenders are dipping into these vast pots of cash controlled by insurers using a type of securitization. So-called rated feeders turn stakes of private debt funds into top-rated bonds. And they’re multiplying: Just this week Apollo Global Management Inc. raised $5 billion through a variation of a rated feeder.