The benefits of partnerships with banks in Direct Lending

In an increasingly competitive direct lending landscape, deal origination is critical to achieving consistent returns across the asset class. This webinar will explore the benefits of bank partnerships, including: - Access to a greater number of loans - Access to off market transactions with more conservative structures - Access to deep local knowledge in banks’ individual loan markets Our origination approach at Federated Hermes Private Credit is built around a series of bank partnerships that afford us access to some of the most attractive deals in our preferred segment. While our partner bank agreements provide us with the right of first refusal to a robust and continued pipeline of potential opportunities, they also grant us access to unique off-market transactions, further broadening the potential investment pool to transactions not accessible to any other direct lenders in the market. Going forward, this approach is designed to allow us to remain credit pickers – not takers – and perform regardless of market fundamentals through selecting the highest-quality opportunities in the market for our investors. As well access to a consistent pipeline of potential investment opportunities, whatever the economic backdrop, partnerships with banks can also be leveraged to provide access to off market transactions with more conservative structures and better lender protection rights. This provides investors access to portfolios of loans with appealing risk reward parameters. In addition, banks benefits from deep local knowledge in their individual loan markets, providing a competitive advantage over other direct lenders. It’s important to note however that that not all partnerships are the same quality. Here we will outline the pros and cons that different partnerships can provide.