The ultra-rich are increasingly eyeing the private credit sector over the slowing private equity distributions, Bloomberg reports, citing discussions at a recent London Private Markets Meeting panel. This interest is fueled by family offices — controlling about USD 3.1 tn globally as of last year — which are drawn to private credit’s regular banknote interest payments, a key advantage over private equity’s reliance on future exits.

Looking for higher returns: Offering attractive, high single-digit returns with less risk than equities, the illiquid asset class is a natural fit for the “buy-and-hold” mentality of family offices, especially amid public market volatility. Alternative credit’s ability to reliably generate yield and income is “great in the current environment,” Harinder Hundle of the Hundle multi-family office noted.

Private credit has strong growth potential: A late 2024 BNY Wealth survey showed private credit has not historically been a top allocation for family office. That seems to have changed in 2025, when a BlackRock family office survey revealed that a third of respondents plan to increase their exposure to private credit — the highest of any asset class.

ALSO- US President Donald Trump’s tariffs are expected to drive a shift of corporate operations back to the US, creating a window for private credit to step in where capacity-constrained governments fall short, Moody’s Global Head of Private Credit Marc Pinto told Bloomberg. Infrastructure — particularly USD 2.5 tn in expected data center investment — is one of the major growth areas, Pinto added.

As the market expands, it is also maturing, with Pinto noting a pivot toward financing more stable, investment-grade firms to meet demand from institutional clients like ins. companies rather than traditional high-yield companies.

The rapid influx of capital is not without concerns: Hundle warned of a potential problem, caused by the huge sums of capital concentrated among the largest managers and a lack of transparency in the biggest agreements. Pinto echoed the sentiment, cautioning that agreement complexity and the need for more detailed information for buyers can introduce credit risks.

MARKETS THIS MORNING-

Asian markets are showing mixed performance this morning, with the Shanghai Composite is up 0.4%, while Japan’s Nikkei is down 0.4%. Trump’s tariff threats toward the EU and Mexico also sent Wall Street futures into the red territory.

EGX30

33,053

-0.8% (YTD: +11.1%)

USD (CBE)

Buy 49.42

Sell 49.56

USD (CIB)

Buy 49.43

Sell 49.53

Interest rates (CBE)

24.00% deposit

25.00% lending

Tadawul

11,253

-0.2% (YTD: -6.5%)

ADX

10,065

+0.2% (YTD: +6.9%)

DFM

5,855

+0.4% (YTD: +13.5%)

S&P 500

6,260

-0.3% (YTD: +6.4%)

FTSE 100

8,941

-0.4% (YTD: +9.4%)

Euro Stoxx 50

5,383

-1.0% (YTD: +10.0%)

Brent crude

USD 70.36

+2.5%

Natural gas (Nymex)

USD 3.31

-0.7%

Gold

USD 3,364

+1.2%

BTC

USD 119,024

+1.4% (YTD: +26%)

S&P Egypt Sovereign Bond Index

EGP 880.4

+0.1% (YTD: +25.6%)

S&P MENA Bond & Sukuk

145.86

-0.1% (YTD: +4.2%)

VIX (Volatility Index)

16.4

+3.9% (YTD: -5.5%)

THE CLOSING BELL-

The EGX30 fell 0.8% at yesterday’s close on turnover of EGP 3.0 bn (40.2% below the 90-day average). Local investors were the sole net buyers. The index is up 11.1% YTD.

In the green: Credit Agricole (+2.3%), Fawry (+1.8%), and Oriental Weavers (+1.7%).

In the red: Telecom Egypt (-3.8%), Qalaa Holdings (-3.1%), and Egyptian Kuwaiti Holding-EGP (-3.0%).

Tags: