Asset-Based Finance Isn’t Just Active—It’s a Lifeline — Evening Brief – 03.05.25
The private credit scene, especially asset-based finance, is buzzing this year—think of it as a corner of the market where lenders back loans with hard assets like real estate, receivables, or equipment, often sidestepping the volatility of corporate cash flows. With $1.1 trillion in dry powder floating around globally (per Bain & Company’s latest report), investors are piling into these strategies for their yield and diversification perks, especially as President Trump’s tariffs rattle traditional markets.
Neuberger Berman’s been riding this wave, recently closing its NB Specialty Finance Fund III (NBSF III) with over $1.6 billion. Already 45% deployed, the fund is about high-yield, short-duration asset-based deals. With $508 billion firm-wide, Neuberger is flexing its muscle here—$300 million for their first fund in 2020, now $1.6 billion. It’s a bet on steady returns in a choppy market.
Not to be outdone, Balbec Capital sealed its Global Credit Fund VI last month with over $1.7 billion in commitments—another oversubscription from its $1.5 billion goal. This Chicago-based firm, with $5 billion under management, dives deep into distressed and specialty credit. Fund VI is their biggest yet—Fund V hit $1.3 billion in 2022. CEO Brian Schubert pegged it as a play on disciplined sourcing in a “dynamic market,” with 70% of LPs re-upping.
Meanwhile, Mesirow, a Chicago-based financial services firm with $245 billion in assets under management, acquired Bastion Management in January—a Connecticut-based specialty finance lender focused on asset-backed credit. Mesirow’s CEO Natalie Brown called it a “natural extension” of their $3 billion private credit arm, Mesirow Capital Partners, which already plays in middle-market lending. This move bulks up their asset-based strategies.
Asset-based finance is thriving because it’s a hedge against uncertainty. These funds offer collateral-backed stability—Neuberger’s short-duration loans are a hedge against rate volatility, Balbec’s distress bets thrive on market dips, and Mesirow’s Bastion acquisition adds flexibility.
Early 2025 is proving asset-based finance isn’t just active—it’s a lifeline.