Citigroup is in talks to roll out a brand new direct lending technique within the early a part of subsequent 12 months.
Based on a Bloomberg report, the funding financial institution is eager to achieve entry to the rising non-public credit score market, which is believed to be price roughly $1.75trn (£1.4trn).
Learn extra: Non-public debt funds: Wealth whispers
An government from Apollo International Administration just lately instructed that the true measurement of the non-public credit score market could possibly be as excessive as $40trn.
Citi intends for the direct lending initiative to enrich the financial institution’s current broadly syndicated leveraged finance enterprise. This will contain teaming up with exterior companions to supply capital for loans, which the financial institution itself would originate.
Learn extra: Blackstone elevating $400m to spice up non-public credit score fund
The purpose of the brand new technique is to have the ability to supply a possible borrower a high-yield bond, leveraged mortgage, or non-public credit score possibility, which the corporate, or their non-public fairness proprietor, might then select relying on their wants, Bloomberg reported.
An individual near the financial institution mentioned that Citi needs to be prepared for a recent wave of buyout offers as non-public fairness companies ultimately must promote current portfolio corporations to pay again buyers.
Learn extra: Cheyne Capital seems to be to boost £7.5bn for property lending
