#United States #New York #private credit #Neuberger Berman #Investment Fund

Neuberger Berman Launches Its First Interval Fund

Neuberger Berman, a renowned private investment manager, has recently announced the launch of its first interval fund, the NB Asset-Based Credit Fund, seeking to offer individual investors unique private credit solutions. This initiative is an important milestone in providing access to investment opportunities that have conventionally been limited to institutional entities.

Understanding the NB Asset-Based Credit Fund

The NB Asset-Based Credit Fund aims at generating substantial current income through a portfolio that focuses on short-duration, asset-backed credit investments. The investment scope varies from receivables lending and consumer loans to small business financing, trade and receivables finance, and even real estate-backed securities. The interval fund structure allows for continuous share offerings on a daily basis, which provides investors flexibility and transparency in their investment management.

As per the regulations under the Investment Company Act of 1940, the fund is positioned as a closed-end, non-diversified management investment company. This structure provides distinct advantages, including lower investment minimums for investors, daily valuations, and limited liquidity opportunities.

High Potential Returns

Peter Sterling, the head of Neuberger Specialty Finance, emphasized the aim of the fund to yield high current income while offering diversification across different financial environments. He stated, “We aim to deliver high current income that is uncorrelated to many other credit investments.” This effectively positions the fund as a viable option for investors looking for stability amid fluctuating market conditions.

The timing for the launch of this fund could not be better. The asset-based credit market has surpassed $5 trillion, reflecting a pivot away from traditional banking institutions. As more individual investors seek to incorporate alternative strategies into their portfolios, the NB Asset-Based Credit Fund presents various income opportunities.

Expert Management Team

The success of the fund is backed by Neuberger’s Specialty Finance team, comprised of seasoned professionals with an average of over 20 years in investment management experience. Their established relationships within the industry, along with the ability to participate in loan origination, position the fund strongly for success.

Scott Kilgallen, Managing Director and Head of North American Intermediary at Neuberger, highlighted the need for diversified sources of credit as financial advisors continue to evolve in their strategies. He remarked, “The NB Asset-Based Credit Fund offers an accessible structure for investors to achieve that goal.”

Notable Recent Success

The fund's launch follows the successful closure of the NB Specialty Finance Fund III LP, which raised over $1.6 billion and exceeded its original target of $1 billion. This showcases Neuberger's expertise in raising funds and connecting with a wide array of investors, spanning from institutions across the U.S., Canada, the Middle East, and East Asia.

Neuberger Specialty Finance, initiated in 2018, has managed to accumulate over $4 billion across more than fifty portfolio companies and various investment vehicles. With a strong emphasis on active management and fundamental analysis, Neuberger has positioned itself as a leader in the asset management space.

Conclusion

The launch of the NB Asset-Based Credit Fund signifies a pivotal moment as Neuberger Berman opens doors for individual investors in the realm of private credit investment. As demand for diverse income avenues surges, this fund stands out as an innovative offering tailored to meet evolving market needs. For investors seeking to enhance their portfolios while enjoying stability in income, the NB Asset-Based Credit Fund could be an ideal option in the evolving financial landscape.