Challenges ahead

Regulation and fees top investor concerns, but the return of the banks could be the biggest danger of them all.

Regulation is the top concern for limited partners investing in private debt, but there are many other issues keeping investors awake at night.

According to a survey by Intertrust, 61 percent of private debt investors are concerned about regulation while 48 percent are worried about fees. These are perennial issues in both the alternatives space and also more widely for investors in listed equities, bonds and more.

Digging deeper, 30 percent are concerned about fundraising, though it seems at odds with the vast fundraisings achieved in 2017 but it is possible investor appetite for the asset class may slow down this year.

Notably 24 percent expect a resurgence of bank lending to check private debt’s rise, and with interest rate rises on the horizon that seems a reasonable concern.