Alternative asset manager Balbec Capital LP has secured roughly $465 million in commitments for its sixth flagship fund, which will invest in consumer, residential and commercial loan portfolios.
(Bloomberg) — Alternative asset manager Balbec Capital LP has secured roughly $465 million in commitments for its sixth flagship fund, which will invest in consumer, residential and commercial loan portfolios.
Launched last week, the InSolve Global Credit Fund VI is expected to grow into Balbec’s largest fund ever, according to a person with knowledge of the matter. The vehicle will scoop up non-performing or sub-performing consumer and mortgage loans — the latter of which will span residential and commercial properties — said the person, who asked not to be identified as the details are private.
The fund will also buy mortgage servicing rights and unsecured non-performing loans. All the deals will range from $1 million to $100 million in size, added the person.
A representative for Balbec declined to comment.
The fund raise comes as credit quality continues to deteriorate across markets. Auto delinquencies and rejection rates for credit card applications are rising, as is the rate of commercial-mortgage backed securities that are delinquent or in workouts with special servicers.
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The Bloomberg CMBS Investment-Grade Index has slipped 0.91% so far this month, while the Bloomberg US MBS Index fell 2.35%, on a total return basis.
Balbec is also eyeing loans from thinly capitalized companies in need of liquidity, said the person. It also expects to buy performing loans from US regional banks, which have been shedding assets lately to bolster capital. The likes of California-based PacWest Bancorp and Georgia’s Synovus Bank recently offloaded large consumer and auto loan portfolios.
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Balbec closed its fifth global private credit fund last summer after securing more than $1.5 billion of capital commitments, making it the firm’s largest fund to date. Since the firm’s inception in 2010, Balbec has deployed over $16 billion globally.
Founding partner and Chief Executive Officer Charles Rusbasan previously launched Bear Stearns’ Max Recovery unit devoted to Chapter 13 bankruptcy debt. Balbec counts former Bear Co-Chief Operating Officer Warren Spector as its chairman.
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