Episode 151: Asset-Backed Lending in a Higher Rate Environment

In this episode of the InsuranceAUM.com podcast, host Stewart Foley, CFA, welcomes back Connell Hasten, Partner at Victory Park Capital, to discuss the ever-evolving world of private credit, particularly asset-backed lending in a higher interest rate environment. Connell shares valuable insights on how private credit has grown tenfold since the Global Financial Crisis, outlining the reasons for its popularity among insurance companies today. He breaks down the different sectors of private credit, such as cashflow and asset-backed lending, highlighting the latter’s importance for mitigating risks, especially in today’s volatile economic climate.

Connell also touches on the best practices for insurance companies looking to allocate to private credit for the first time and for those more experienced in the space. He explains why defensive strategies such as floating rate loans, senior secured debt, and short-term loans are crucial for navigating the current environment. With rising rates and increasing demand for non-bank lenders, Connell’s insights provide a roadmap for insurance investors seeking to optimize their portfolios through private credit.