Manulife | CQS Investment Management (MCQS) has closed its third regulatory capital relief fund with $1.1 billion in commitments, extending a ten-year track record of partnering with European banks seeking balance-sheet optimization. The capital raise—across the Manulife CQS Regulatory Capital Relief III Fund and separately managed accounts—continues the firm’s strategy of providing capital relief through structured transactions backed by high-quality loan portfolios. 

The regulatory capital market has grown roughly 25% annually, according to MCQS, which has completed more than $3 billion in transactions since entering the space in 2014. These deals allow banks to free up regulatory capital while offering institutional investors attractive, low-correlated returns. 

“Regulatory capital forms a central component of our structured credit platform,” said Soraya Chabarek, President and CEO of MCQS. “We’ve been at the forefront of developing this market alongside Europe’s leading banks for more than a decade.” 

Originally integrated within CQS’s asset-backed securities platform, the regulatory capital strategy became a standalone fund series in 2019 with the launch of the first dedicated long-lock vintage. The firm employs a rigorous 75% rejection rate on potential deals, emphasizing stress testing and structural analysis to maintain low default rates and limited correlation with broader credit markets. 

Building on current momentum, MCQS plans to launch a fourth vintage fund in 2026, alongside expanding its asset-backed finance strategies, which now account for over one-third of the structured credit platform. 

As of September 30, 2025, MCQS managed $18.5 billion across alternative credit strategies. Since Manulife’s 2023 acquisition of CQS’s alternative credit platform, the firm has broadened its product lineup with vehicles such as the Manulife CQS Multi-Asset Credit Fund and the John Hancock CQS Asset-Backed Securities Fund.