By Yantoultra Ngui
SINGAPORE – Singapore’s state investment company Temasek said on Friday that it has established a wholly owned private credit entity with an initial portfolio amounting to S$10 billion ($7.5 billion), consisting of direct investments and credit funds.
Institutional global investors in recent years have been ramping up activity in the booming private credit market. Private credit, or lending to companies by institutions other than banks, has grown rapidly as stricter regulations following the Silicon Valley Bank crisis in 2023 make it more expensive for traditional lenders to finance riskier loans.
The asset class is set to grow to $2.6 trillion by 2029 from $1.5 trillion at the end of 2023, Preqin data showed. Reflecting that trend, the world’s largest asset manager BlackRock announced on Tuesday that it will buy private credit firm HPS Investment Partners for about $12 billion. Temasek said in a statement that the entity will be managed by a team of around 15 credit investment professionals across offices in New York, London and Singapore, who have been transferred from its credit and hybrid solutions team. It will be led by CEO Nicolas Debetencourt, who has been Temasek’s credit and hybrid solutions head since 2016. Temasek said it has been investing in credit funds for over a decade and a dedicated entity will help scale its credit and hybrid solutions portfolio and capture global private credit opportunities. This is in addition to Temasek’s asset management business Seviora Group, which includes SeaTown Holdings International that offers private credit solutions in Asia.
Temasek owns a S$389 billion total portfolio as of March 31, and has focused on long-term investments with themes such as digitisation and sustainability.
($1 = 1.3388 Singapore dollars)
(Reporting by Yantoultra Ngui; Editing by Nicholas Yong)
