Big super corners business lending

, a trend being accentuated by bank capital constraints and the actions of the prudential regulator.

“I think the funds are going to be interested in anyone who brings ideas. And one of the current ideas ... they like is lending and investing in fixed assets, which they see as bringing some protection from simply investing in companies with the vagaries of the cash flow of the company and the vagaries of the international market.”scale of fund flows for big super

Lamborn says the increased flow of funds into big super has to be offset against the need for liquidity. He says the super early release scheme implemented during COVID-19 had made super funds far more cautious about illiquid investments. Aware Super set up a direct lending operation in Sydney four years ago and has since committed about $2 billion in loans to listed corporates, family-run businesses, middle-market companies and private equity-sponsored real estate and infrastructure assets.

Gary Byrd, president of Pratt Industries in the United States, says US pension funds have been willing to back 15- to 20-year loans, and he was hopeful Australian super funds would follow suit and bridge the gap between bank term debt and longer loan maturities.Advertisement

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