Apollo Global Management Inc. is exploring the possibility of establishing a trading desk to buy and sell direct loans in the $1.7 trillion private credit market, which is typically illiquid. While the plans are still preliminary and could be abandoned, Apollo’s interest follows similar moves by other firms like Golub Capital and JPMorgan Chase.
These firms are actively trading private loans, although such transactions remain rare due to lenders' preference to hold debt until maturity. Concerns exist that increased trading could undermine the benefits of direct lending, such as privacy, convenience, and price stability.
However, secondary trading could be attractive to investors looking to enhance liquidity or reposition their portfolios. As the private credit market evolves, trading direct loans might become more common, especially for distressed assets.
Finsum: As a key figure in the space its important to keep an eye on the changes Apollo is making in private credit.
- private credit
- corporate credit
- credit
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