Australia probes private credit funds as A$200 billion market strains
Why it matters: The regulator flagged property lending, tighter liquidity and weaker loan quality ahead of month-end valuations.
Australia’s corporate regulator is investigating several private credit funds and warning managers to use realistic assumptions in valuing assets before an end-of-month reporting deadline. The Australian Securities & Investments Commission said the A$200 billion local market is facing its “first test” as tighter liquidity and borrower stress expose governance and pricing risks. Real estate, including development and construction finance, is a key focus because it makes up much of the country’s private credit lending. ASIC also cited survey data from 22 managers covering 52 funds that showed credit deterioration in some sectors, with pockets of higher defaults, impairments and loan amendments.