{"id":17642,"date":"2025-11-28T15:00:54","date_gmt":"2025-11-28T14:00:54","guid":{"rendered":"https:\/\/www.chetwode.fr\/?p=17642"},"modified":"2025-12-16T15:49:07","modified_gmt":"2025-12-16T14:49:07","slug":"offshore-private-credit-in-europe-and-its-relevance-to-south-african-investors","status":"publish","type":"post","link":"https:\/\/www.chetwode.fr\/en\/asset-financing\/offshore-private-credit-in-europe-and-its-relevance-to-south-african-investors\/","title":{"rendered":"Offshore private credit on the European market and its relevance to South African and international investors"},"content":{"rendered":"\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t\t\t
<\/div>\n\t\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

Newsroom<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

Chetwode<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t
<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

Offshore private credit on the European market and its relevance to South African and international investors<\/h1>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t
<\/div>\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

The second episode of “Offshore Offscript”<\/em> explores one of the fastest-growing investment categories globally: offshore private credit<\/strong>, with a particular focus on the European market and its relevance to South African and international investors. The session, led by hosts from Fedgroup, features expert perspectives from Greg Goeller<\/strong>, Head of Structuring and Lending at Fedgroup, and Jean-Baptiste Magnen<\/strong>, Managing Partner at Chetwode in Paris. Their discussion revolves around the definition of private credit, the structural forces driving its growth, and the strategic benefits it offers within modern portfolio construction.<\/p>\n

Private credit, as defined in the discussion, is non-bank, unlisted lending<\/strong>. Unlike traditional bank finance, private credit operates outside of the regulated banking environment and fills the gap banks increasingly leave behind\u2014particularly for small and medium-sized enterprises (SMEs)<\/strong>. Fedgroup has an established track record in private credit across the South African property, agriculture, renewable energy, and private capital sectors. The group\u2019s expansion into Europe represents a significant opportunity, offering broader deal flow, enhanced diversification, and exposure to stronger hard-currency economies.<\/span><\/p>\n

A central driver behind the global rise of private credit was the 2008\u20132009 financial crisis<\/strong>, which led to far more restrictive banking regulations (Basel rules). European banks subsequently pulled back from medium- and long-term SME financing, creating a persistent supply gap. A second catalyst came in 2012<\/strong>, when European regulations changed to allow life insurers to invest directly into economic activity, including lending to SMEs. These structural shifts enabled the private credit market to scale significantly and professionalize over time.<\/p>\n

Today, private credit represents roughly 5% of the global listed equity market<\/strong>, up from less than 1% a decade ago\u2014a remarkable expansion in such a short period. This growth reflects both demand and performance. Investors increasingly seek stable, predictable income<\/strong>, particularly in volatile or uncertain equity markets. Because private credit involves negotiated loan agreements with fixed returns and defined amortization schedules, it provides stable yield with generally lower correlation to traditional asset classes.<\/p>\n

The specific niche Fedgroup and Chetwode focus on lies in the \u20ac1 million to \u20ac20 million deal range<\/strong>, an underserved segment in Europe. Banks primarily target very small (<\u20ac1 million) or very large (>\u20ac20\u201330 million) deals, but the mid-market remains chronically underfunded. This is meaningful in Europe, where up to 95% of businesses are owner-managed SMEs<\/strong>, compared to about 75% in South Africa. These companies form the backbone of European economic activity and require flexible financing solutions that private credit providers can offer.<\/p>\n

A defining characteristic of the strategy is its emphasis on asset-backed finance<\/strong>\u2014loans secured against essential, \u201ccritical\u201d operating assets that are fundamental to a company\u2019s functioning. The podcast illustrates this using concrete examples such as:<\/p>\n