KKR sees progress in credit score in fourth quarter

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KKR noticed its belongings below administration throughout credit score and liquid methods rise by 12 per cent year-on-year to $245bn (£195bn) in 2023, with direct lending and asset-based finance seeing probably the most exercise within the fourth quarter.

The New York-listed funding agency stated that this determine includes $123bn of leveraged credit score, $48bn of asset-based finance, $38bn of direct lending, $10bn of strategic investments and $27bn of liquid methods, pertaining to hedge fund partnerships.

Learn extra: KKR cautions on UK shopper finance dangers

Its newest outcomes additionally revealed that new capital raised in that phase of the enterprise within the fourth quarter of final 12 months was pushed by inflows at its insurer subsidiary World Atlantic, direct lending within the US and Europe, and CLO formation.

KKR invested $6bn throughout its credit score and liquid methods within the fourth quarter, bringing the 2023 whole as much as $15bn.

Its leveraged credit score enterprise noticed returns of 14 per cent, whereas its different credit score investments returned 10 per cent throughout the 12 months.

Learn extra: World personal debt fundraising in 2023 barely down from 2022

The agency reported just below $1bn in fee-related revenues from its credit score and liquid methods final 12 months, and greater than $72m of fee-related efficiency revenues.

KKR – which is historically recognized for its personal fairness enterprise – now has 5 per cent of its holdings in different credit score and 7 per cent in leveraged credit score.

Non-public fairness homes are turning to non-public credit score for yield as they battle a protracted decline in dealmaking.

Learn extra: May price cuts be welcomed by personal credit score managers?

KKR’s general enterprise posted after-tax distributable earnings of $888m within the fourth quarter, a 4 per cent enhance that beat analysts’ estimates.

Charge-related earnings rose by 21 per cent throughout the quarter to $675m because of progress in administration charges and KKR’s capital markets unit.



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