Steve Boyko, co-chair of Proskauer’s Private Credit Group, spoke with Debtwire on the growth of the direct lending market.

Competition for lower-rated deals is expected to intensify as direct lending funds begin to put a significant cash pile to work. According to research firm Preqin, direct lending funds have raised USD 56 billion this year to date—and moreover, they are sitting on USD 104 billion of dry powder. The influx of funds stands in contrast to a torrent of outflows from retail loan funds this year, Debtwire sources noted.

Given this demand disparity, direct lenders are unlikely to retreat from their offensive on the syndicated loan market, said Steve Boyko. “Our clients have created large fundraising machines where they are approaching institutional and retail investors, both in the US and abroad,” he said. “We don’t see that retrenching from here.”

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