Amid recent jitters in the private-credit market, the Hong Kong Monetary Authority is reportedly assessing private credit funds and exposure scales with private banks, while many Asian private bankers are working to contain client anxiety, Bloomberg reported.
Private bankers in Hong Kong and Singapore have been receiving urgent calls from their high-net-worth clients seeking information about the private-credit market or to redeem their private-credit products, the report said.
Asian regulators are also ramping up scrutiny of this asset class to safeguard inexperienced individual investors, who are more sensitive to negative news and vulnerable to market swings than their institutional counterparts.
Asset managers like Blue Owl, Blackstone, and KKR have hosted events with private bankers in Hong Kong and Singapore to calm investors' tensions.
Besides, Blackstone has conducted online meetings with parts of retail clients to emphasize that the company's exposure to stressed software assets is limited compared with peers, and it has sufficient cash to meet redemption needs.
Blue Owl's representative said the firm engages with distribution partners and clients worldwide in a regular manner, which is part of its normal business.
HKMA said it does not comment on market rumours.
Currently, retail investors hold about US$48.8 billion (HK$382.5 billion) of the private credit funds in the Asia Pacific, which is estimated to grow to US$74.8 billion by 2028, according to Broadridge Financial Solutions.
This came as investors' confidence eroded in the private credit market recently, as some bankrupt US and European companies that were financed by private lenders. International asset managers, including BlackRock, Blackstone, and Blue Owl Capital, saw a wave of withdrawals in their investment vehicles.
