A second look on private debt

In the latest episode of The Astute Investor, LGT Wealth Management’s Head of Private Markets, Martin Randall, speaks with Francesco Valmarana, Partner at Pantheon and member of its European Investment and Global Private Credit Investment teams, about the rapid evolution of private credit and the growing role of secondaries.

Francesco explains how secondaries have shifted from a niche corner of private equity to a mainstream portfolio management tool, and how the same dynamic is now playing out in private credit. 

In today’s environment, he notes that returns are driven by the underlying loan yield, the incremental yield uplift from buying below par, the amortisation of that discount over the remaining life of the loans, and the potential “pull to par” as written down positions recover.

The discussion also touches on the distinction between senior direct lending and the broader opportunistic credit universe and how secondaries can provide access to these markets with enhanced transparency and risk control.