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Alternative investments

 

Alternative investments span a broad range of non-traditional asset classes, such as private debt and real assets. Once seen as a niche area, they have risen to a place of prominence in many portfolios over the last decade, particularly in the ongoing search for yield.  

BNP Paribas Asset Management (BNPP AM) has an extensive track record in the alternatives space, extending back to 2006, and today boasts a dedicated team of over 50 professionals that manage around €9 billion of assets*.

 

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WHY ALTERNATIVES?

In today’s global investment environment where equities remain volatile and sovereign bond yields in low or negative territory, investors – in particular insurance companies and pension providers – have found meeting their investment goals challenging.

Alternative investments aim to offer a solution. With the help of an experienced investment manager, they can potentially provide a sustainable income stream and diversification.

At BNPP AM, we focus on what we believe are three of the most attractive areas of the alternatives market: corporate loans, real assets and structured finance.

 

Corporate loans

Corporate loans represent a large and diverse investment opportunity set. Those issued by larger companies are typically floating rate instruments, which can help to mitigate interest risk given that they will pay higher yields if prevailing rates rise. Loans issued by medium and small-sized businesses often have strong covenant packages and, owing to the size of their business operations, are potentially well insulated from the impact of adverse macro events.

 

Real assets

Real assets cover infrastructure and commercial real estate debt, which gives investors’ exposure to large physical assets such as airports, roads and buildings. Given the nature of the underlying projects which are being financed, we believe real assets can offer stable income over a long-term horizon, and are regarded as secure investments due to the physical collateral involved. The longer-term nature of the debt also means investors can earn an illiquidity premium compared to similarly rated corporate bonds.

 

Structured finance

Structured finance refers to asset-backed securities (ABS), cash-flow generating assets that are linked to a large pool of smaller loans, such as credit cards and mortgages. Their performance is more closely tied to credit and real estate fundamentals, as opposed to corporate balance sheet health, meaning they can offer stable return potential, as well as diversification from traditional asset classes like equities and corporate credit.

 

Why us

WHY US?

Our alternatives investments are powered by our Private Debt and Real Assets (PDRA) platform, which seeks to offer innovative solutions across corporate loans, infrastructure and real estate debt, and structured finance.

Underpinning our platform are several key features that we believe are key to building value for investors:

  • A comprehensive approach to credit, covering multiple stages from selection, valuation, monitoring to structuring
  • Unique access to BNP Paribas’ global financing franchise that dates back over 150 years
  • Full environmental, social and governance (ESG) integration in our investment process

BNPP AM on private debt

 

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ALTERNATIVE INVESTMENT CAPABILITIES

Corporate loans

Real assets

Structured finance

  • Global loans
  • Middle market loans
  • Small and medium enteprise (SME) lending
  • Small and medium (SME) altenative finance
  • Real estate debt
  • Infrastructure debt
  • Asset backed securities (ABS)
  • Mortgage backed securities (MBS)
  • Collateralised loan obligation issuance

 


DISCLOSURES

*Source: BNPP AM, December 2019. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. This advertisement has not been reviewed by the Monetary Authority of Singapore. It is issued and has been prepared by BNP PARIBAS ASSET MANAGEMENT Singapore Limited [BNPP AMS]. It is produced for information purposes only and does not constitute: 1. an offer to buy nor a solicitation to sell, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or 2. investment advice. It does not have any regard to the specific investment objectives, financial situation or particular needs of any person. Investors should consult their own professional advisors in respect of legal, accounting, domicile and tax advice prior to investing in the fund(s), and in the event that he chooses not to seek advice from professional advisors, he should make an independent determination of the suitability and consequences of an investment. Investors considering subscribing to the fund(s) should read carefully the most recent prospectus, offering document including the risk factors and consult the fund(s’) most recent financial reports before investing, as available from BNPP AMS or its authorised distributors. Investments involve risks. Investments in emerging markets involve above-average risk. Given the economic and market risks, there can be no assurance that the fund(s) will achieve its/their investment objectives. Investments in the fund are not deposits or other obligations of, or guaranteed, or insured by BNPP AMS or its authorised distributors or its affiliates and are subject to investment risks, including the possible loss of principal amount invested. Returns may be affected by investment strategies or objectives, markets and economic conditions. Past performance of the fund(s) or the managers, and any economic and market trends or forecast, are not necessarily indicative of the future or likely performance of the fund(s) or the manager and the value of the investments in fund(s) may go down as well as up. Investors may not get back the amount they originally invested. Funds which are invested in emerging markets, smaller companies and derivative instruments may also involve a higher degree of risk and are usually more sensitive to price movements. Views and opinions included herein constitute the judgment of BNPP AMS and its affiliates at the time specified and may be subject to change without notice. BNP PARIBAS ASSET MANAGEMENT Singapore Limited - registered office at 20 Collyer Quay, #01-01, 20 Collyer Quay, Singapore 049319. Company Registration No. 199308471D.