LONDON: Swiss lender UBS Group and U.S. investment firm General Atlantic have agreed to make a joint push into the booming market for private credit, the companies said on Tuesday in the latest deal between a bank and an alternative asset manager.
Under the partnership, UBS will source and find loans to make to companies in North America and Western Europe, which General Atlantic can then offer to investors through its investment strategies.
General Atlantic will manage a private credit team formed with executives from its credit arm and UBS Asset Management’s credit investment business, the companies said.
Private credit has boomed in recent years, as lightly-regulated providers such as asset managers gain market share from banks facing greater regulatory constraints.
That has forced banks to team up with private credit managers in partnerships that allow them to hold on to customer relationships without having to deploy their own capital.
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Recent agreements include Deutsche Bank giving its asset management arm DWS the first look on deals it originates, while HSBC is also preparing to move into the market, Reuters reported last month.
Private credit refers to the loans typically made to riskier borrowers or companies looking to clinch mega buyouts with debt. These loans can be processed quickly and are an important source of funds for borrowers deemed too vulnerable by conventional banks.
The companies did not disclose the capital they will commit to the new partnership.
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