Close Menu
Voxa News

    Subscribe to Updates

    Get the latest creative news from FooBar about art, design and business.

    What's Hot

    Ukraine drone attack sparks fire at Sochi oil depot, Russia says

    August 3, 2025

    Car finance payouts limited, but lenders aren’t off the hook

    August 3, 2025

    The Nintendo Switch 2’s Biggest Problem Is Already Storage

    August 3, 2025
    Facebook X (Twitter) Instagram
    Voxa News
    Trending
    • Ukraine drone attack sparks fire at Sochi oil depot, Russia says
    • Car finance payouts limited, but lenders aren’t off the hook
    • The Nintendo Switch 2’s Biggest Problem Is Already Storage
    • ‘The Seasons,’ Film on Alentejo, Portugal at Locarno, Gets Trailer
    • 16 Wedding Dress Styles to Know When Shopping For Your Big Day
    • England v India: fifth men’s cricket Test, day four – live | England v India 2025
    • 12 Fantastic Indian Restaurants in NYC
    • French swimmer Léon Marchand cruises to 400m medley world title
    Sunday, August 3
    • Home
    • Business
    • Health
    • Lifestyle
    • Politics
    • Science
    • Sports
    • Travel
    • World
    • Entertainment
    • Technology
    Voxa News
    Home»Business»Singapore’s GIC signals caution on private credit
    Business

    Singapore’s GIC signals caution on private credit

    By Olivia CarterJuly 24, 2025No Comments4 Mins Read0 Views
    Facebook Twitter Pinterest LinkedIn Telegram Tumblr Email
    Singapore’s GIC signals caution on private credit
    GIC manages around $800bn in assets for the Singapore government according to the Sovereign Wealth Fund Institute © Lionel Ng/Bloomberg
    Share
    Facebook Twitter LinkedIn Pinterest Email

    Unlock the Editor’s Digest for free

    Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

    Singapore’s GIC sovereign wealth fund has signalled growing caution about investing in the fast-growing private credit asset class, citing shrinking yields and the market’s lack of experience of a sustained downturn.

    GIC, which manages some $800bn of assets on behalf of the city state according to the Sovereign Wealth Fund Institute, has not publicly disclosed previous investment in private credit, but has long been a big player in global private equity and real estate.

    “We are now at a part of the cycle where we feel that spreads are a lot tighter [and] valuations are also higher,” said Bryan Yeo, GIC’s chief investment officer ahead of the release of the fund’s annual results on Friday. “Hence we are raising the bar in terms of further deployment into the private credit space.”

    Yeo highlighted the market’s lack of experience of a major downturn as a source of potential concern.

    “In hindsight we haven’t really seen a major credit default cycle [in private credit],” added Yeo — excepting what he called a “shortlived spike” during the Covid pandemic.

    GIC is “raising the bar” on new investment in private credit © Edgar Su/Reuters

    His comments are the latest in a series of warnings about the risk of investors rushing into the rapidly burgeoning private credit sector in search of higher yields amid a cooling of the private equity market and increased equity volatility.

    Private credit has boomed in the past decade as tighter regulation since the 2008 financial crisis increasingly stopped traditional banks from lending to riskier companies, creating an opportunity for “alternative” players including groups like Blackstone and Apollo Global Management. 

    In June a group of US bankers, economists and officials warned that private credit could become a “locus of contagion” in a future financial crisis and be a fresh amplifier of systemic stress.

    US spreads for leveraged loans, the public market’s analogue to private credit, are around 4.34 percentage points, just above a low of 4.27 points over the past 12 months and comfortably below the five-year average of 5.08, according to data from JPMorgan and PitchBook LCD.

    US borrowers have taken advantage of low financing costs to issue about $100bn in leveraged loan deals so far in July, well above June’s $66bn and the most since January, the data shows.

    GIC said its private credit arm was part of its wider private equity team and focused on directly financing private equity-backed companies, which Yeo said gave the fund an advantage over many other private credit investors who were “siloed” off from the underlying asset. 

    “Is the valuation of the equity reasonable? Is it overvalued? How are we thinking about the business? Because, you know, in general credit investors and equity investors approach credit and equity investments quite differently,” said Yeo.

    GIC publishes few detail about its investment performance, with Friday’s results not breaking down its exposure to private equity, credit or specific countries.

    Unlike fellow Singaporean fund Temasek, GIC does not reveal its returns over the past year. Its preferred performance metric is its 20-year rolling rate of return above inflation — which it said was 3.8 per cent at the end of March. That was the lowest rate since 2020, when it was 2.7 per cent.

    Some content could not load. Check your internet connection or browser settings.

    A “reference portfolio” of 65 per cent global equities and 35 per cent bonds has outperformed the fund — which also invests in real estate, private equity and private credit — on a nominal basis over five, 10 and 20 years. However, GIC stresses that its portfolio is less volatile.

    The fund said it increased its exposure to equities including private equity by five percentage points to 51 per cent of its total portfolio in 2025. Its fixed income allocation fell from 32 per cent to 26 per cent, while “real assets” increased by one percentage point to 23 per cent. It said the US remained the largest recipient of its investment cash.

    Some content could not load. Check your internet connection or browser settings.

    GIC separately warned in its outlook that it continued to see the “macro impacts of the rise of populism” globally in higher government debt and lower appetite for structural reform.

    The fund said it had trialled an AI agent as a member of its investment committee and it was experimenting with giving such agents different personality types including “contrarian investor” and “optimistic investor”.

    Recommended

    It also said it was investing in artificial intelligence companies, but avoiding frothy valuations and concentrating on those that had defences against competition, citing investments including in data analytics company Databricks and digital infrastructure company Equinix.

    “We seek to avoid short term hype as well as overvaluations by focusing on companies with strong, durable moats,” said Yeo.

    caution credit GIC private signals Singapores
    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Olivia Carter
    • Website

    Olivia Carter is a staff writer at Verda Post, covering human interest stories, lifestyle features, and community news. Her storytelling captures the voices and issues that shape everyday life.

    Related Posts

    Car finance payouts limited, but lenders aren’t off the hook

    August 3, 2025

    Quentin Tarantino Shares Michael Madsen Story During Private Memorial

    August 3, 2025

    Despite Trump, the US economy remains surprisingly resilient. But for how long? | Richard Partington

    August 3, 2025

    Car finance judgement ‘a hard pill to swallow’

    August 3, 2025

    Influencers in Number 10? Inevitable

    August 3, 2025

    Revealed: Yorkshire Water boss was paid extra £1.3m via offshore parent firm | Water industry

    August 3, 2025
    Leave A Reply Cancel Reply

    Medium Rectangle Ad
    Top Posts

    27 NFL draft picks remain unsigned, including 26 second-rounders and Bengals’ Shemar Stewart

    July 17, 20251 Views

    Eight healthy babies born after IVF using DNA from three people | Science

    July 17, 20251 Views

    Massive Attack announce alliance of musicians speaking out over Gaza | Kneecap

    July 17, 20251 Views
    Don't Miss

    Ukraine drone attack sparks fire at Sochi oil depot, Russia says

    August 3, 2025

    Tabby Wilson and Adam DurbinBBC NewsDSNS UkraineHomes were hit in a Russian missile strike on…

    Car finance payouts limited, but lenders aren’t off the hook

    August 3, 2025

    The Nintendo Switch 2’s Biggest Problem Is Already Storage

    August 3, 2025

    ‘The Seasons,’ Film on Alentejo, Portugal at Locarno, Gets Trailer

    August 3, 2025
    Stay In Touch
    • Facebook
    • YouTube
    • TikTok
    • WhatsApp
    • Twitter
    • Instagram
    Latest Reviews
    Medium Rectangle Ad
    Most Popular

    27 NFL draft picks remain unsigned, including 26 second-rounders and Bengals’ Shemar Stewart

    July 17, 20251 Views

    Eight healthy babies born after IVF using DNA from three people | Science

    July 17, 20251 Views

    Massive Attack announce alliance of musicians speaking out over Gaza | Kneecap

    July 17, 20251 Views
    Our Picks

    As a carer, I’m not special – but sometimes I need to be reminded how important my role is | Natasha Sholl

    June 27, 2025

    Anna Wintour steps back as US Vogue’s editor-in-chief

    June 27, 2025

    Elon Musk reportedly fired a key Tesla executive following another month of flagging sales

    June 27, 2025
    Recent Posts
    • Ukraine drone attack sparks fire at Sochi oil depot, Russia says
    • Car finance payouts limited, but lenders aren’t off the hook
    • The Nintendo Switch 2’s Biggest Problem Is Already Storage
    • ‘The Seasons,’ Film on Alentejo, Portugal at Locarno, Gets Trailer
    • 16 Wedding Dress Styles to Know When Shopping For Your Big Day
    • About Us
    • Disclaimer
    • Get In Touch
    • Privacy Policy
    • Terms and Conditions
    2025 Voxa News. All rights reserved.

    Type above and press Enter to search. Press Esc to cancel.