Aegon has received approval from the Financial Conduct Authority (FCA) to launch a private credit long-term asset fund (LTAF) – the firm’s first use of the investment vehicle.
Head of institutional business Jill Johnston highlighted investors’ growing interest in private markets, stating that an LTAF launch made the most sense to provide clients with access to the previously opaque asset class.
“Private markets have received a great deal of attention over recent years with a particular focus on new groups of investors, such as defined contribution pension funds and the wealth management market, who have previously not necessarily had any significant exposure to this type of asset class,” she said.
“The LTAF offers investors access to illiquid assets in a regulated structure which might not have been possible in the past. The valuation, subscription and redemption processes provide additional protection for investors but also encourage long-term investment where daily liquidity is not necessary, such as for long-term pension savings.”
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The investment vehicle was first introduced by the FCA in late 2021 after moves from the government to provide investors with access to alternative assets in an open ended format.
They are aimed to give a wider pool of savers exposure to assets that had typically been available a minority of investors, such a private markets.
Rich Willoughby, product lead at Carne Group, added: “As demand for private markets continues to intensify across both institutional and retail wealth audiences, the launch of Aegon AM’s LTAF represents an important milestone in the opening up of private credit opportunities to a broader investor base, including UK pension savers.”
This story was written by our sister title, Portfolio Adviser
