U.S. Specialty Lender Finance & Private Credit Forum

November 16, 2022

Specialty lenders make up a fast-growing segment of the U.S. credit economy, presenting increasingly diverse opportunities for institutional investors across private equity and asset-based financing. Much like leveraged lending is to corporates, specialty finance is an important lifeline for businesses and households via the financing of credit types spanning mortgages, consumer credit, small business loans, receivables financing, asset leasing, to name a few. According to Integer Advisors, an independent investment advisory firm specialising in alternative and private credit markets, the size of this non-bank lending market is estimated to be around $8 trillion measured by stock outstanding globally and is forecast to grow by at least 50% over the next five years.

Growth of the non-bank specialty lending markets is being fueled on the one hand by the scale of the ‘underserved’ borrower populations created following the multi-year retrenchment by banking systems, and on the other by the significant technology advances made by many specialty lenders that better cater to the evolving demands and preferences of business and household borrowers alike. For investors, specialty finance opportunities offer exposures to typically large, diversified pools of both real and financial assets at attractive yields versus public securitizations or most forms of vanilla private credit. The specialty finance market has been transformed over the decade since the financial crisis, fueled by the significant investment interest from mainstream institutional investors.

Bayshore’s own Chris Grizzard joined a team of exceptional panelists to explore the key factors fueling the growth of this non-bank lending sector as an important finance tool and an attractive investment opportunity for institutional buyers alike.