We expect the Asian fund financing market to continue its rapid growth. Huge amounts of private capital have been raised for investment in the region and demand for subscription line facilities will reflect this. We predict growth in volume and size of deals, with more mega-deals involving large clubs of banks. With this increase in borrower demand more banks will enter into the market and many of those already involved will compete hard to grow market share. As the regional PE market matures, managers will look for liquidity solutions to support existing portfolios, assist with succession or finance commitments in upcoming launches. NAV and hybrid facilities will become more common (but remain highly bespoke) and managers/GPs will likely enter into more loans secured by economic interests in underlying funds.
ESG will continue to be a trend across many markets including fund financing. Driven by manager and investor demand, we expect an increase in deals with ESG features and more lenders positioned to provide and monitor such loans within the region.
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