MA Financial looks to sidestep ‘cracks’ in US private credit as it avoids tech lending
Shares in the alternative asset manager fell by around 10% in response to its “pretty solid” full-year results, with the downward move puzzling its co-CEO.
Alternative asset manager MA Financial has acknowledged cracks are appearing in the US private credit market, but is confident it is protected because it is underexposed to high risk areas such as technology.
Speaking to Capital Brief following the ASX-listed company’s full-year result co-chief executive Christopher Wyke said MA steered clear of investing in stressed areas such as software and AI, and revealed the company is plotting a further expansion in the world’s largest economy.
“Indeed there are cracks in US private credit but they are in certain categories of private credit, in particular, corporate leveraged loans, and in particular, lending to technology companies that may well be disrupted by recent AI,” he said.
“Some of the headline numbers we ran was that the BDCs [business development companies], which are listed private credit entities in the States, had exposure to tech-related lending of about 22% of their portfolio. That’s a number that investors might look at and say ‘I need to interrogate you’. Our private credit exposure to technology companies is 2.9%.”
