The Credit Edge by Bloomberg Intelligence TPG Angelo Gordon Predicts Home Equity Borrowing Boom
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Nov 27, 2024 TJ Durkin, Head of Structured Credit and Specialty Finance at TPG Angelo Gordon, discusses the booming opportunities in home equity borrowing as homeowners capitalize on rising real estate prices. He predicts a staggering $150 to $200 billion in annual origination, highlighting the shift towards asset-based finance. The conversation touches on the evolution of structured finance, the challenges facing private debt, and emerging trends in commercial real estate and residential solar energy. Durkin emphasizes new strategies and regulatory impacts shaping the future of lending.
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Structured Credit Boom
- Structured credit markets are booming due to a healthy economy, favorable spreads, and capital seeking alternatives to corporate credit.
- Continued heavy issuance is expected if market conditions remain stable.
New Issuers and Products
- Newer issuers and products are entering the structured credit market, with data centers and fiber-to-home as more scalable examples.
- Niche products are still primarily in private markets.
Private Credit Growth
- Private credit growth is driven by asset-backed finance, where specialty finance companies are gaining market share from traditional banks in areas like auto loans and real estate.
- The events of March 2023 significantly increased investor interest in this space.