New fund allows investors to keep money onshore
Institutional investors in Australia can now venture lower on the credit spectrum, with a new fund allowing managers to invest in a portfolio of institutional or corporate loans with credit ratings from A to BB.
The new fund launched by Metrics Credit Partners allows a $1.1 billion investment in a portfolio of 21 institutional or corporate lonas, covering a range of industries and included both listed and unlisted debt, leveraged buy-out and acquisition finance, property debt and more.
IOOF Multimix has been the first investor to try out the new fund, announcing an allocation of $75 million to the Metrics Credit Partners Diversified Australian Senior Loan Fund.
Previous funds have tended to specialise in leveraged buy-out finance or property debt, but Metric Credit Partners gives exposure to a broad range of assets including investment-grade and sub-investment grade in one vehicle, a representative said. Metric Credit Partnrs say research by Towers Watson shows the Australian superannuation market, the fourth-largest in the world, has a clear bias to domestic equities but an offshore bias to credit because they couldn’t access it in meaningful size and diversity domestically.
The move is consistent with the RBA’s concerns about reducing systemic risk within the banking sector.