Mubadala turns its USD 25 bn credit book into an asset-management play

Mubadala is turning one of its biggest in-house investment engines into a product it can sell. The Abu Dhabi wealth fund is transferring management of a USD 25 bn credit portfolio — about 6% of its USD 385 bn balance sheet — to Mubadala Capital under a long-term agreement while retaining ownership of the assets, Bloomberg reports. Mubadala will also commit another USD 4.65 bn to expand the platform as Mubadala Capital prepares to raise money from pension funds, insurers, and wealthy clients.

Why it matters: This is Mubadala using its balance sheet as a launchpad for fee-generating asset management. The credit business had previously invested only Mubadala’s own capital — now it can raise traditional funds, evergreen vehicles, and other products for external investors. “Mubadala is doubling down on Mubadala Capital in more ways than one,” Mubadala Capital’s CEO Hani Barhoush told the business news service.

The asset manager is wagering that bank retreats from direct lending will leave more room to lend, particularly in Europe and Asia. This expansion comes even as parts of the USD 1.8 tn private-credit market face a wave of redemptions — a trend managers admitted heading into 2Q results is unlikely to ease quickly.

BACKGROUND- This isn’t a cold start. Mubadala began investing in private credit back in 2009 and deliberately built the business by backing specialist managers rather than running its own lending desk. This structure allowed it to source dealflow across direct lending, infrastructure and real estate debt, private credit secondaries, NAV financing, and Asia-focused lending, according to Omar Eraiqat, who will lead the newly carved-out Credit and Solutions unit.

Over the past two years, the fund has gotten notably more aggressive across its portfolio, wading into complicated transactions many sovereign peers avoid — including the 2024 acquisition of Canada’s CI Financial (one of the largest-ever privatizations by an Abu Dhabi entity in financial services), a 42% stake in LA-based Silver Rock Financial backed by more than USD 1 bn in commitments, an ins. partnership with Aquarian.

Khaldoon Al Mubarak will take over as chairman of Mubadala Capital, which has grown from an in-house private equity unit into a broader alternatives manager spanning credit, ins., real estate, and wealth management. Mubadala Capital now manages, advises, and administers more than USD 600 bn in assets, with over 200 staff across Abu Dhabi, New York, London, San Francisco, and Rio de Janeiro.