M&G Investments has obtained the regulatory inexperienced mild for its Lengthy-Time period Asset Fund (LTAF), enabling it to supply a non-public credit score technique to UK outlined contribution (DC) pension schemes.
The primary fund that the asset supervisor plans to launch beneath the LTAF construction is the M&G Diversified Personal Credit score Feeder LTAF.
That is an evergreen fund that can spend money on a diversified portfolio of personal credit score, structured credit score and asset-backed debt.
Learn extra: M&G buys majority stake in personal credit score agency
M&G mentioned that its LTAF will goal the UK’s quickly rising DC market, which is forecast to develop from £579bn to £1.39tn by 2033, citing Broadridge information.
It mentioned the approval is a big step in its ambition to develop its £73bn personal markets enterprise by widening investor entry to its methods.
LTAFs are a regulatory construction designed to make it simpler to take a position into long-term, illiquid belongings together with pivate credit score.
Learn extra: M&G’s personal credit score ELTIF opens to wholesale purchasers throughout Europe
The LTAF comes after M&G launched its first European Lengthy-Time period Funding Fund in 2023 – the equal automobile within the EU – which now manages €850m of company personal credit score belongings.
“M&G is dedicated to the UK’s DC market the place funding innovation and entry to non-public markets methods is a vital space of focus,” mentioned Emmanuel Deblanc, chief funding officer of personal markets at M&G Investments.
“We’re enjoying our half on this utilizing the pressure of our lengthy established personal markets enterprise and our expertise of managing diversified personal credit score for UK pensions since 2012.
“This approval units the stage for future progress of our personal markets options for our DC pensions purchasers enabling them to effectively and flexibly combine personal markets options to ship resilient returns, enhance diversification and in the end, ship higher member outcomes.”