Growth Opportunities for Private Credit In Australia

Australia has recently experienced growth in its private credit sector – addressing demand and opportunities currently underserved by the traditional banks. Peter Zanapalis, Country Executive Australia at Alter Domus, recently spoke to Joe Millward, Founding Partner of Epsilon Direct Lending, to give Sensus readers deeper insight into Australia’s burgeoning private credit scene.

With over 20 years of experience in banking and lending with companies like Commonwealth Bank of Australia, Bank of America and Royal Bank of Scotland, what was the driving factor behind the decision to set up Epsilon Direct Lending in 2019 with your fellow co-founders?

There are plenty of commonalities between our three founding partners. For me, the current situation is like betting on a replay. What we’re seeing in Australia today is a replay of what happened in Europe and the US 15-20 years ago, in terms of a transition of lending market share from banks to non-banks.

I was involved in the start of the non-bank movement in Europe and witnessed the evolution in that market over the years. As recently as five years ago, the conditions weren’t right in Australia, as the banks were still reasonably efficient. However, in recent years, customers began mentioning that their counterparts in the US and Europe were finding it much more efficient to obtain non-bank funding – and they were highly supportive of us to set up our own shop. In that respect, it’s really been a customer-led effort.

This article was originally published in Sensus Magazine. Download the PDF of this full article by clicking the image below.