Tuesday, December 3, 2019, 12:05 PM - 12:55 PM | Regulatory Capital Transactions: Accessing Credit While Harvesting Potential High Returns
With low corporate bond spreads and investors seeking new sources of illiquidity premium prolonging the low interest rate environment, devising high yield credit strategies with reasonable risk has become a major challenge. Strategies with high entry barriers, such as difficult market access, bespoke due diligence, strong bilateral relationships and implementation complexity are examples of this. As are regulatory capital transactions, whereby long-term institutional investors gain access to diversifying credit investments including large corporates, SMEs, consumer or commercial real estate loans through the core lending activities of commercial banks. This session will seek to:
- Demonstrate how banks and agile investors have formed partnerships to pursue core lending strategies in stringent regulatory capital regimes;
- Explore the benefits for the long-term credit portfolios of investors such as pensions funds;
- Share AXA IM’s experience of negotiating access to bank balance sheets;
- Highlight the key points to consider to extract the best rewards while avoiding pitfalls.