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Financing the Economy

New research examines the real-world impact of the financing provided by private debt and how direct lenders are supporting borrowers through a challenging and uncertain market.

The 2022 edition of the Financing the Economy report, examines the key issues shaping the market and the increasingly important role that private debt plays in the global economy.

The report, which is produced by the Alternative Credit Council in partnership with Allen & Overy, reflects the views of leading private credit firms, collectively managing more than USD800 billion in assets under management. Report insights were drawn from surveys and/or one-to-one interviews.

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Report highlights

  • Infrastructure, professional services, TMT and healthcare & life sciences: These were the top four industries invested in by private credit fund managers, because they are believed to be resilient and have strong growth prospects.
  • Growth across geographies: The data highlights continued growth across the U.S., U.K. and Europe, and particularly strong levels of confidence in the growth potential for private credit in Asia, with 65% of respondents citing a jurisdiction in the region as having the highest growth potential. This year has already seen the launch of multiple $1bn+ private credit funds targeting investment in Asia. Flexible credit solutions and certainty of execution continue to be prized by borrowers.
  • Challenges and opportunities: 55% of surveyed private debt managers cited macroeconomic risks, inflation, realignment of global supply chains and changes in customer behaviour (including how products and services are delivered to end consumers) as the biggest challenges for their portfolios and future lending activity. In response to greater stress in the market, the private debt community has enhanced its risk management practices. Moreover, lenders are demonstrating greater selectivity and discipline when granting loans and sharpening their focus on due diligence processes. ESG and stewardship remain a core part of lenders’ activities, notwithstanding market challenges.
  • Retail investor base will continue to grow: Retail investor base will continue to grow, reflecting investor appetite and increased availability of new fund vehicles. UK and EU efforts to support retail investment in private credit through the LTAF and ELTIF are expected to provide new sources of capital for the sector.

Financing the Economy 2022

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Download the report to find out how direct lenders are supporting borrowers through a challenging and uncertain market.


Private credit: Overview of Allen & Overy services

The continuing rapid development of the global private credit industry is presenting its leading players with an ever more complex set of strategic choices, opportunities and challenges. Increasing competition, greater regulatory scrutiny, an uncertain macro-economic environment, increase of larger EBITDA and sponsor-backed borrowers accessing private debt (sometimes with terms drawn from the syndicated market, and with a corresponding increase in club deals), and a greater appetite for investment in a wider range of products, borrowers and geographies mean that lenders need to have a full view of the risks and opportunities available to them in every market and on every transaction.

Our expertise across the capital structure, products and geographies, and advice for both direct lenders and sponsors, gives us and our clients an unparalleled perspective and a deep and practical understanding of the most significant, legal, regulatory and commercial issues facing private credit managers across the world’s leading markets.

Learn more about our private credit offering here.


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