Spotlight on Joe Moroney, Partner, Co-Head of Global Corporate Credit & Head of Sustainable Finance, Apollo
Global Thought Leader Spotlight
Joe Moroney, Partner, Co-Head of Global Corporate Credit & Head of Sustainable Finance, Apollo
In my role as Partner and Co-Head of Global Corporate Credit at Apollo, I am responsible for overseeing the corporate finance investment team as well as our fixed income replacement strategy, Investment Grade Private Credit.
The asset class is a growing part of the market, has evolved to a broader investable universe including asset-backed and bespoke corporate financing solutions and is a newer tool to help enhance the return profile of a fixed income portfolio.
I joined Apollo in 2008 as the Head of Apollo’s Global Performing Credit Group and I also serve as Head of Sustainable Finance.
Emergence of private credit and bank partnerships
Long viewed as competitors, the relationship between banks and private credit firms has recently grown more symbiotic.
Over the past year, more than a dozen banks have struck deals with private credit firms to partner, up from only two such transactions announced in the preceding year. For instance, Barclays and AGL Credit Management announced in April that they will work together on originating private credit loans; Apollo and Citigroup disclosed in September that they are teaming up in a partnership that will target up to US$25 billion worth of private credit deals over the next five years; and a news report in October indicated that J.P. Morgan was teaming up with Cliffwater, FS Investments, and Shenkman Capital Management in an effort to broaden its reach in the private credit market.
These ventures can enhance capital market access for a wide variety of issuers. Banks can now marry their extensive Rolodex of client relationships with the tenor and flexibility of capital managed by private credit firms to offer tailored solutions to borrowers. Further, rather than distributing these loans to a broad list of investors, banks, through these partnerships, can place these loans with a single, or select group of investors. This arrangement can allow for an expedited negotiation process as well as more customised structures that better fit the funding requirements of certain borrowers.
Evolution of private credit and bank partnerships
The emergence of these partnerships is occurring as the total AUM of private credit funds have increased to US$1.6 trillion, up 15% over the past five years.
As more issuers entertain private financing options, it is only natural that banks would look to leverage their strengths in order to maintain relevance in this growing part of the credit market. Most of the partnerships referenced above are currently focused on sub-IG corporates. Over time, we expect that similar partnerships will extend to the IG market as well.
Although funding is typically widely available for IG-rated companies in the public markets, the homogenous nature of the public IG market leaves a diverse set of borrowers with few options to customise their debt financings to meet their specific capital needs. This has created the opportunity to provide more flexible solutions, with many IG-rated issuers increasingly looking to private credit as a more versatile financing source. We believe private credit and bank partnerships can help address this.
This partnership can offer a bespoke financing solution that gives borrowers the flexibility they desire while offering investors an avenue to pick up spread over conventional IG debt in a downside protected manner.
We have seen corporate hybrid securities—with partial equity credit, deferrable coupons and embedded call options—gaining popularity among IG-rated issuers and we believe that bank-private partnerships will accelerate the adoption of these alternative solutions.
Joe will be presenting at Global Investment Institute’s upcoming Private Credit Investment Forum, taking place on Thursday, 8 May 2025 at the Grand Hyatt Melbourne, Victoria. To register your interest in attending, click here or for more information email zlatan@globalii.com.au.
Joe Moroney, Partner, Co-Head of Global Corporate Credit & Head of Sustainable Finance, Apollo
Joe is a Partner in Apollo's Credit Business and currently serves as Co-Head of Global Corporate Credit and Head of Sustainable Finance. He joined Apollo in 2008 as the Head of Apollo’s Global Performing Credit Group.
Prior to joining Apollo, Joe was with Aladdin Capital Management where he served as the Senior Managing Director of its Leveraged Loan Group. Joe’s investment management career spans 30 years, with experience at firms including Merrill Lynch Investment Managers and MetLife Insurance.
Joe graduated from Rutgers University with a BS in Ceramic Engineering and is a Director Emeritus of the Rutgers University Foundation. He is a Chartered Financial Analyst and a member of the NYSSA.
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