“Private credit is the only bright spot in asset allocation right now.”

The themes around private credit of consistent returns, valuation stability and low-risk portfolios were repeatedly underlined in the twenty or so meetings we had with investors in our weeklong trip around Seoul, South Korea.

Fortunately conditions are increasingly propitious for both private credit managers and investors in this country. Regulatory relief is helping. Recently released proposals ease burdens of foreign investor registration and off-market trading.

Also, according to Preqin, amendments in 2021 to the Capital Market Act allow South Korean PE firms “to use mezzanine financing, a mix of debt and equity financing if all their investors are institutions.” As our Chart of the Week highlights, private debt represents one of the fastest growing assets in Korea.

Some of the fundraising is focused on domestic markets, particularly financing opportunities for chaebols, or Korean family-run industrial conglomerates. Others address distressed borrowers.