Schroders secures $1.5bn for asset-based lending fund

The new fund will look for securitised credit opportunities including consumer finance, real estate and commercial assets.

Schroders has closed its asset-based private credit fund at $1.5 billion after receiving backing from UK and US-based institutional investors.

The vehicle, Focus II Fund, was launched in Q2 2020 and brings the total assets raised by Schroders securitised credit team to over $15 billion since 2016.

The fund will focus on investments in asset-based loans spanning consumer receivables, housing, commercial real estate and commercial assets.

Schroders’ head of securitised credit, Michelle Russell-Dowe, said expectations of a prolonged low interest rate environment means investors need to identify options that can access a range of opportunities in complex and inefficient markets.

“Against a backdrop of economic and social change, we see a sequence of opportunities. Not all opportunities manifest at the same time in a cycle and, for our fund, we view near-term opportunities,” she said.

“These are, firstly, in housing and our view is that additional opportunities in consumer debt and real estate will continue to develop. Of critical importance is the flexibility to access these opportunities in their more attractive formats, ranging from public securities to private loans.”

Schroders’ securitised credit team is based in London and New York and invests in a range of securitised assets globally. Schroders acquired the securitised lending business from Brookfield in 2016, adding more than $4 billion of assets under management and merged it with its existing asset-based lending team.