Private Debt Forum 2026: Navigating opportunity in an evolving market

Natixis CIB recently hosted the fourth edition of its Private Debt Forum, welcoming clients and industry leaders to London for the event's first edition outside of Paris. Bringing together experts from across banking, asset management and institutional investing, discussions focused on how private debt is evolving as an increasingly important component of the global financing ecosystem.

Opening the forum, Michael Haize, Global Head of Global Markets at Natixis CIB, highlighted the continued transformation of private debt markets. While the asset class continues to attract significant capital, he noted that today's environment is defined less by rapid expansion than by increasing sophistication, as investors seek differentiated opportunities across direct lending, asset-backed finance, infrastructure and other private credit strategies. Discussions throughout the day referenced the scale the market has now reached – a private credit market estimated at $40 trillion, within which non-bank led direct lending accounts for an estimated $2-3 trillion.

Throughout the day, a recurring theme emerged: as private credit matures, success will depend on disciplined underwriting, innovative financing structures and the ability to adapt to changing market dynamics.

The forum opened with a fireside conversation between Khalid Krim, Global Head of FIG Coverage at Natixis CIB, and Hamza Lemssouguer, Founder and CIO of Arini, exploring how private credit investors are identifying value in a market where capital remains abundant, but opportunities are becoming more selective.

A central theme was the importance of maintaining an independent investment mindset. As competition for assets intensifies, the discussion highlighted the value of rigorous fundamental analysis and avoiding consensus thinking. Rather than chasing popular sectors or following established market narratives, successful investors can differentiate themselves through disciplined credit selection and careful downside protection.

Separately, the European private credit market also continues to evolve. While sponsor-backed direct lending remains highly competitive, participants noted growing opportunities in less crowded areas of the market, particularly among mid-market non-sponsored businesses and asset-backed finance. Structural changes in European banking – including the effects of continued de-banking – are creating new financing needs, opening attractive opportunities for private capital providers able to deliver flexible, tailored solutions.

Asset-backed finance was highlighted as another area of significant growth, with governance and transparency becoming crucial as investors expand into more specialised financing structures. The discussion emphasised that robust due diligence and strong alignment between lenders and borrowers will remain essential as the market continues to innovate.

Looking ahead, institutional investors are becoming more focused on diversification within private credit itself. Rather than viewing the asset class as a single allocation, investors are looking for differentiated strategies offering exposure to distinct sectors, borrower profiles and sources of return.

The first panel of the day focused on the growing dispersion across private credit markets and how investors are adapting their capital allocation strategies. The discussion was moderated by Mathilde Boyez, Head of Asset Managers Coverage for EMEA at Natixis CIB, and featured Brian Coulter, Managing Director, European Credit at CPP Investments; Kris Kraus, Managing Director, Head of Private Strategies EMEA/APAC and Global Co-Head of Asset Backed Finance at PIMCO; and Stefano Questa, Partner and Co-Head of European Alternative Credit at Ares Management.

The panellists agreed that today's market is characterised by divergence rather than uniform performance. While private credit has demonstrated resilience through recent market cycles, higher interest rates product innovations and structural drivers like rating or formats are creating wider differences between private credit strategies and managers. Headlines often group private credit together, but there are distinct dynamics that have played out across different parts of the market. Understanding these differences is critical to assessing both risk and opportunity.

Higher financing costs have placed greater focus on credit quality and underwriting discipline. Although many borrowers have successfully adapted to the new rate environment, refinancing risks and upcoming maturity walls are expected to increase the importance of manager selection over the coming years. The panel noted that current market noise should clear over the next two to three quarters, highlighting the resilience of private credit products through this period.

The discussion also explored new products, niche strategies creating permanent performance variation and the continued expansion of asset-backed finance, with panellists highlighting its breadth and flexibility compared with more traditional direct lending strategies. As institutional investors seek greater diversification, asset-backed finance is attracting growing interest by providing exposure to a wider range of real economy assets and financing opportunities.

Artificial intelligence (AI) also featured prominently throughout the panel. While AI is expected to drive significant investment in digital infrastructure and financing demand, speakers noted that it also introduces new uncertainties for credit investors. Assessing both the opportunities created by AI-driven growth and the potential disruption across existing industries will require even more sophisticated credit analysis.

Ultimately, the speakers concluded that manager differentiation is likely to become even more pronounced. Firms successfully managing several and large private credit strategies,  withdeep sector expertise, strong research capabilities and rigorous credit processes are expected to be better positioned to navigate future market cycles and growing market complexity , allocating investments dynamically to the right private credit pockets.

The second panel of the day focused on the evolution of fundraising and capital formation in private credit. Moderated by Eric Elbaz, Global Head of Credit Sales and Head of Global Markets Sales & Structuring, APAC at Natixis CIB, the discussion brought together Zeshan Ashiq, Private Credit & Alternative Income at USS; Michael Bogdan, Global Head of Alternatives Research & Development at Goldman Sachs Asset Management; Soraya Kazziha, Managing Director and Head of EMEA Insurance Portfolio Strategy at Blue Owl; Lalantika Medema, Executive Vice President and Alternative Credit Strategist at PIMCO; and Elise Moulinier, Executive Director at PGIM.

Panellists explored how innovation in investment structures is reshaping access to private credit for a growing range of institutional and wealth investors. As demand for private market exposure continues to increase, managers are developing more flexible vehicles and financing solutions that better reflect the evolving needs of investors, including semi-liquid vehicles and rated feeder structures designed to bring private credit exposure to a broader investor base without sacrificing the underlying credit discipline of the strategy.

Secondaries and continuation vehicles emerged as a significant thread in the discussion, with the market for continuation vehicles reaching around $250 billion last year – roughly 1.5x growth versus 2024 – as sponsors and LPs look for liquidity solutions against a slower M&A and IPO backdrop. Panellists framed fund financing and continuation structures as a genuine liquidity tool rather than a sign of distress, if transparency around valuation and structure is maintained.

Insurance capital was also a recurring focus, with panellists discussing the importance of structuring solutions to align with insurance-specific constraints and requirements. The complexity of underlying asset classes was flagged as a particular consideration for insurance firms, where simplicity in structuring is especially valued. Panellists also noted the scalability challenges of securitisation-style techniques and their reliance on external rating agencies, making the case for scalable, simpler structures where the end investor is insurance or retail-adjacent capital.

The discussion highlighted the growing convergence between public and private markets, with private credit becoming an increasingly important component of diversified fixed income allocations. Investors are seeking differentiated sources of return while benefiting from financing solutions tailored to specific borrower requirements.

Transparency, governance and liquidity management were identified as critical considerations as private credit expands to a broader investor base. While innovation remains an important driver of growth, maintaining clear product structures and robust risk management practices will be essential to sustaining investor confidence.

Looking ahead, the panel agreed that continued innovation across fund structures, distribution channels and capital formation will help support the next phase of development for the asset class.

The forum also welcomed a keynote introduced by Alain Durré, Managing Director and Chief European Economist at Natixis CIB, and featuring Dr. Catherine L. Mann, External Member of the Monetary Policy Committee at the Bank of England.

The keynote explored the evolving macroeconomic environment and the implications of inflation, monetary policy and financial conditions for markets. Drawing on recent research, Dr. Mann discussed how inflation expectations and firms' pricing behaviour are becoming key indicators for assessing the outlook for inflation. The research suggests firms are becoming less anchored to short-term inflation expectations than previously assumed, while financial market participants, though more anchored on average, show more volatility in their expectations.

Dr. Mann also pointed to evidence that monetary policy transmission is now faster than previously understood, with firms observed revising down their price growth expectations within days of a Bank Rate decision. She argued this makes closely tracking firms' pricing behaviour, wage-setting dynamics and fiscal developments even more important for policymakers, and flagged that the timing of price developments carries particular significance for the path of UK CPI inflation into 2027, with upside risks to inflation currently seen as outweighing downside risks to activity.

In addition, Dr. Mann also addressed the impact of fiscal policy, financial market conditions and AI on the economic outlook. On AI, she suggested the demand and global pricing implications are relatively clear in the short term, while the longer-term effects on employment remain considerably less certain, with regional differences in policy support and privately financed AI investment likely to shape how different central banks respond.

The keynote put the spotlight on one of the day's overarching themes: in an environment characterised by uncertainty and rapid change, disciplined analysis and adaptability remain essential for investors and policymakers alike.

Concluding the forum, Elie Bitton, Global Head of Sales & Structuring at Natixis CIB, reflected on the discussions that had shaped the day.

A consistent message emerged throughout the forum: private debt has evolved beyond an alternative asset class to become a core component of the global financing ecosystem. While today's environment presents new challenges – including inflation, higher financing costs, geopolitical uncertainty and the accelerating impact of AI – the underlying fundamentals remain supportive.

In this respect, differentiation is becoming crucial. As capital once again carries a price, disciplined asset selection, sound portfolio construction and rigorous risk management are becoming the defining drivers of long-term performance. At the same time, resilient economies, well-capitalised banking systems and sustained investment across infrastructure, digital technologies and the energy transition continue to generate significant opportunities for private capital.

Collaboration between banks, institutional investors and alternative asset managers also emerged as a defining theme. By combining origination capabilities, financing expertise and access to global pools of capital, these partnerships are helping to deliver increasingly tailored financing solutions while supporting the continued development of private credit markets.

As private debt enters its next phase of growth, innovation, selectivity and long-term partnerships are expected to remain at the heart of the asset class, reinforcing its role as an increasingly important pillar of global finance.

Thank you to all our speakers and participants for joining the fourth edition of the Natixis CIB Private Debt Forum and for sharing their insights.