Concerning private credit - Can you elaborate on the key advantages private credit offers to borrowers, particularly in comparison to traditional forms of financing, and how these benefits align with current market trends and investor appetites? Private credit has become increasingly popular as investors seek diversification and stability. Unlike traditional financing, private credit offers lower sensitivity to market news and serves as a hedge against equity volatility. Quintar specializes in distressed/private credit, which exhibits low volatility and is counter-cyclical. Furthermore, private credit’s floating rate feature, tied to risk-free rates like SOFR, allows it to stay competitive during interest rate hikes. In contrast, fixed coupon bonds decline in value when rates rise. With the current high inflation and rising interest rate environment, private credit’s ability to provide diversification, stability, and competitive returns aligns well with market trends and investor preferences. What is Quintar Capital’s approach to risk concerning private credit? Private credit investments present similar risk factors to publicly traded fixed-income securities, but one notable risk is illiquidity. Unlike publicly traded securities, private credit investments often lack liquidity, making it challenging to sell or exit these investments quickly, especially in the absence of active secondary markets. This illiquidity can create difficulties for investors in accessing their funds when needed. However, we have established a strong network within the private credit market, which allows us to provide liquidity to the market as needed. Therefore, illiquidity is not a concern for us. In fact, we leverage this advantage by strategically purchasing secondaries of trade finance fund units, enabling us to enjoy high returns by combining the illiquidity premium and credit risk premium. By actively managing liquidity and capitalizing on opportunities in the private credit market, we navigate the challenges posed by illiquidity and maximize returns for our investors. Finally, looking at the global economic trends, particularly in Asia, what are the strategic priorities for Quintar Capital in the next five years? Private credit is a robust strategy in the US and Europe, but remains largely untapped in APAC. Asia’s credit market has grown significantly, yet banks still dominate credit allocation. Quintar sees opportunities to fill this gap, especially in commodity trade finance. We provide capital to commodity traders through asset-backed loans, offering consistent returns with low correlation to credit spreads and interest rates. By leveraging our expertise in private credit and focusing on commodity trade finance in Asia, we aim to tap into the vast opportunities presented by the region’s growing credit market and contribute to the financing needs of commodity market participants. Contact Lilian Lo - Fund Manager Quinter Capital T: +852 3701 1515 E: info@quintar.capital LI: www.linkedin.com/company/quintar-capital/mycompany/ www.quintar.capital Finance Monthly Global Awards 2024. HONG KONG 95
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