Non-Bank Lenders Fill the Void Left by Regulation

The video discusses the growth and development of non-bank lending, highlighting its history, specialization, and the regulatory environment that has allowed it to thrive. It explores the risks and competition within the sector, emphasizing the advantages of focusing on mid-sized private equity. The discussion also touches on potential regulatory changes and the role of international pension funds in funding non-bank lending in the U.S. market.

What is the approximate size of the non-bank lending market compared to corporate debt?

• 500 billion compared to 8 trillion

• 1 trillion compared to 5 trillion

• 2 trillion compared to 10 trillion

• 3 trillion compared to 6 trillion

Why did non-bank lenders find opportunities in the market post-crisis?

• Banks were consistent in the market

• Legislators cracked down on leveraged lending

• There was no competition

• Interest rates were too high

How do non-bank lenders view the risk associated with their segment?

• They find it riskier than other segments

• They believe it has lower volatility

• They think it is too risky to invest in

• They see it as having lower losses and higher returns

What is a key advantage of private equity involvement in non-bank lending?

• Preparedness to invest money and resources

• Lack of resources and experience

• Avoidance of exits

• Focus on emotional decisions

Why are foreign pension funds increasingly investing in the U.S. market?

• The U.S. market is seen as weak

• Global markets are more robust

• The U.S. market is considered strong and robust

• Foreign markets offer better returns