Maples Group has issued the inaugural edition of its Fund Finance Focus providing data and trends from fund finance transactions facilitated by the group in 2024.
While the statistics in this publication are not necessarily reflective of the entire market of credit provision to private funds, Maples Group said the data is based on consistently high activity levels throughout the year and terms across hundreds of deals.
Subscription lines, which are lines of credit or loans secured against the unrealised capital commitments made by limited partners of a fund, continued to make up the bulk of Maples Group’s US market practice with nearly 70% of all new fund finance deals. While most transactions were amendments and joinders, Maples said it still closed 140 new subscription line facilities worth more than $18 billion in committed loans.
Net asset value (NAV) lines – loans extended to funds based on the net value of the fund’s portfolio – also had a strong 2024, particularly in the first half of the year, comprising approximately 25% of all new financings that were closed, Maples Partners Matthew St-Amour and Robin Gibb wrote in their review of the US market.
The average deal size for NAVs tapered off in the second half of the year, whereas the average deal size for subscription lines remained broadly consistent.
Average margins on new subscription lines and NAVs were at their highest in the first and second quarters, falling in the third and fourth quarters as US rate cuts were increasingly priced in.
Subscription lines remained largely consistent in their terms throughout 2024, Maples noted. The vast majority (around 88%) were committed deals and the most popular tenor was 1-2 years (around 64% of all committed deals). Extension options and accordion or increase options were pervasive.
Non-bank lenders featured in approximately 20% of all new NAV deals that we recorded in 2024 but saw their share rise to 35% in the fourth quarter.
Overall, Maples Group said it is optimistic for 2025 and expects increased activity after a gradual start to the year.
For more details, see the entire issue of Fund Finance Focus – 2024 Data Insights.
