Global Fund Banking Outlook Q3 2022
Key takeaways
01
Capital is ready to be put to work
Despite a broader market slowdown, investors remain flush with cash and have ample capital available on the sidelines ready to be deployed.
02
Limited partners remain committed to private equity
Based on an SVB survey sent to LPs this quarter, over 90% of LPs plan to maintain or increase PE target allocations.
03
The quiet exit environment leads to a search for liquidity
With distributions unlikely to match levels of recent previous years, fund managers have sought alternative financing sources for liquidity.
Fundraising pace slows to pre-pandemic levels
With the ecosystem going through a period of recalibration, fundraising is moderating in 2022 – mimicking trends closer to 2018 and 2019 rather than the outsized growth seen last year.
LP survey results indicate that most respondents plan to keep their PE allocations at the same level or increase them
Despite headwinds faced by LPs amidst the market slowdown, LPs remain committed to the PE ecosystem with an overwhelming majority not planning to decrease – and some may increase – their PE target allocations.
Net Asset Value (NAV) loan facility growth
Exit options have become more limited since the beginning of the year, dampening liquidity for fund managers and motivating them to seek out alternative sources of capital such as NAV loans.
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