BNP Paribas Capital Partners (‘BNPP CP’), BNP Paribas Asset Management’s specialist in external alternative manager selection, launched an investment programme (known as ‘Special Opportunities’) earlier this year to provide institutional investors with exposure to the European discounted private debt market. Fundraising is ongoing, with the final target of EUR 250 million expected to be reached in 2019.
The investment programme is structured as a closed-ended fund of debt funds, with a lifespan of seven years and an average duration of about two and a half years. It aims to offer investors a net internal rate of return (IRR) of around 9-12%.
Capital will be deployed in funds invested in corporate debt issued by mid-sized companies that have experienced difficulties or have been excluded from traditional financing channels. The managers selected by BNPP CP target corporate debt and loans, either performing or non-performing, and primarily tier one, within the European financing system. Debt may be bought either on the secondary market or from banks holding it since issue.
The new fund will meet the Solvency Capital Requirement under Solvency II, with a breakdown of each underlying fund’s portfolio available in AMPERE matrix format.
Gilles Guerin, CEO of BNP Paribas Capital Partners, comments:
“The initial closing of BNP Paribas CP European Special Opportunities Debt Fund demonstrates the value and relevance of the concept and will allow us to begin implementing the investment programme. The strategy is being managed by our specialist investment team, whose members average almost 16 years’ experience of identifying, selecting and investing in alternative funds.”
Thierry De Rycke and Giuliano Rajabally, co-managers of BNP Paribas CP European Special Opportunities Debt Fund, add:
“We are very pleased with the positive response from investors, confirming the robustness of our approach in carefully selecting highly specialised managers with proven expertise in their respective markets in Europe. BNP Paribas CP European Special Opportunities Debt Fund offers investors access to market opportunities that are difficult to capture directly.”
Asset Management Performance Reporting – the standard reporting format under Solvency II, designed to facilitate the calculation of the Solvency Capital Requirement.
BNP Paribas Capital Partners is BNP Paribas Asset Management’s specialist in multi-management, selection and incubation of alternative managers, including hedge funds, alternative UCITS, private debt, infrastructure and private equity. As at 30 June 2018 BNPP Capital Partners managed, advised and administered almost EUR 7 billion of assets on behalf of institutional investors, companies, private banks and high net worth individuals.
BNP Paribas Asset Management is the investment management arm of BNP Paribas, one of the world’s major financial institutions. Managing and advising on assets of EUR 560 billion as at 30 June 2018, BNP Paribas Asset Management offers a comprehensive range of active, passive and quantitative investment solutions covering a broad spectrum of asset classes and regions. With more than 500 investment professionals and around 400 client servicing specialists, BNP Paribas Asset Management serves individual, corporate and institutional investors in 72 countries around the world. Since 2002, BNP Paribas Asset Management has been a major player in sustainable and responsible investing.
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