Ensombl PD Day 2026: Private Credit – Opportunity, risk and reality

Private credit has become one of the most closely watched areas of portfolio construction, attracting adviser interest through its potential to deliver strong income and attractive risk-adjusted returns. At the same time, increased regulatory scrutiny has highlighted the importance of understanding the risks, structures and protections that sit beneath different private credit strategies.

The private credit panel’s discussion reinforced that private credit is far from a single asset class. The opportunity set now spans corporate lending, asset backed finance, infrastructure and hybrid capital, with each strategy offering distinct risk and return characteristics. As Privity Credit’s Atiya Habib noted, private credit is no longer defined solely by middle market direct lending. The market is expanding into new areas of private financing, reshaping corporate funding markets and creating a broader range of opportunities for investors.

Despite ongoing economic uncertainty, structural demand for private capital solutions continues to grow in Australia and globally as banks remain constrained across parts of the lending market. This backdrop is supporting continued expansion of the asset class, with AIMA forecasting global private credit assets under management to exceed US$3 trillion in 2026.

The key takeaway for advisers is that understanding how loans are structured, where risks sit, and what protections are in place remains critical. While certain sector tailwinds are likely to persist, the opportunity set is evolving beyond traditional sponsor-backed loans, making manager selection and strategy differentiation more important than ever.