Key Takeaways
- • ASIC released its second major surveillance report on Australia's private credit sector, valued at roughly $250 billion, finding that "complex structures, opacity and deficient disclosure practices persist."
- • ASIC reviewed 24 wholesale and retail private credit funds with a combined $18 billion in assets under management between November 2025 and August 2026.
- • Many poor fee, disclosure, distribution and conflict management practices flagged in ASIC's November 2025 first report remain unresolved, according to the regulator.
- • ASIC has issued six interim stop orders and multiple enforcement referrals, including interim stop orders against Angas Securities Limited over disclosure concerns tied to its financial position and exposure to the Bathla Group.
- • The AIMA and its Alternative Credit Council released new guidance for Australian private credit managers on governance, lending standards, transparency and investor protection.
Summary
Australia's corporate regulator, the Australian Securities and Investments Commission (ASIC), has publicly criticised the private credit sector, which it describes as a roughly $250 billion market, for failing to address concerns about poor lending practices and investor disclosure. ASIC commissioner Simone Constant said, "I am absolutely fed up, at ASIC we are absolutely fed up," and added that the regulator had "drawn a line in the sand" with its second comprehensive surveillance report, according to ABC News.
The report found that "many investors are still not being given the information they need to properly understand the risks, fees and conflicts present in private credit investments." ASIC reviewed 24 wholesale and retail private credit funds with a combined $18 billion in assets under management between November 2025 and August 2026, and also sampled financial advice given to retail investors on private credit. Many fee, disclosure, distribution and conflict management issues identified in the regulator's first private credit report, released in November 2025, were still present.
ASIC has taken several enforcement steps, including six interim stop orders and multiple referrals for further investigation. This week it issued interim stop orders preventing Angas Securities Limited from offering interests in two managed investment schemes, citing product disclosure statements that did not adequately disclose the firm's financial position and one fund's exposure to the Bathla Group. The regulator's concern is the opacity of the sector's finances, which limits investor visibility into risk.
The report comes amid recent stress in the sector. CVS Lane limited investor redemptions this year after significant loans to collapsed developer Bathla, and US firm Blue Owl limited withdrawals earlier this year as software-linked investments lost value, with elevated redemption requests again in the June quarter. ABC News notes that private credit lending also feeds property development and construction.
In response, the Alternative Investment Management Association (AIMA) and its private credit affiliate, the Alternative Credit Council (ACC), released new guidance for Australian private credit managers on governance, lending standards, transparency and investor protection. AIMA managing director and head of Australia Michael Gallagher said private credit plays a crucial role in financing Australian businesses, but acknowledged that "ASIC's reviews have identified weaknesses in parts of the industry that need to be addressed."
The report found that "many investors are still not being given the information they need to properly understand the risks, fees and conflicts present in private credit investments." ASIC reviewed 24 wholesale and retail private credit funds with a combined $18 billion in assets under management between November 2025 and August 2026, and also sampled financial advice given to retail investors on private credit. Many fee, disclosure, distribution and conflict management issues identified in the regulator's first private credit report, released in November 2025, were still present.
ASIC has taken several enforcement steps, including six interim stop orders and multiple referrals for further investigation. This week it issued interim stop orders preventing Angas Securities Limited from offering interests in two managed investment schemes, citing product disclosure statements that did not adequately disclose the firm's financial position and one fund's exposure to the Bathla Group. The regulator's concern is the opacity of the sector's finances, which limits investor visibility into risk.
The report comes amid recent stress in the sector. CVS Lane limited investor redemptions this year after significant loans to collapsed developer Bathla, and US firm Blue Owl limited withdrawals earlier this year as software-linked investments lost value, with elevated redemption requests again in the June quarter. ABC News notes that private credit lending also feeds property development and construction.
In response, the Alternative Investment Management Association (AIMA) and its private credit affiliate, the Alternative Credit Council (ACC), released new guidance for Australian private credit managers on governance, lending standards, transparency and investor protection. AIMA managing director and head of Australia Michael Gallagher said private credit plays a crucial role in financing Australian businesses, but acknowledged that "ASIC's reviews have identified weaknesses in parts of the industry that need to be addressed."
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