Fund Finance

Unique access to emerging value opportunities

Why invest in Fund Finance?

Driven by the exponential growth of private market funds, especially in the last decade, a scalable investment opportunity has developed for fund finance. Fund finance to date has been largely dominated by bank financing but institutional investors are increasingly discovering attractive investment opportunities offering relative value and diversification to alternative risk drivers.

Superior risk-adjusted returns with IG risk profile
Portfolio diversification to alternative risk drivers
What is Fund Finance?

 
The market for fund finance is growing rapidly. In this video, Bas Kragten, Head of Fund finance & Infrastructure, introduces Fund Finance, focusing on Capital Call Financing and NAV Financing - the two market segments we are active in. Bas discusses where the premium over liquids comes from but also what the main risks are in relation to this type of financing.  

Two types of Fund Finance

Private market funds borrow at different stages of their lifecycle. As such, we distinguish between different types of fund finance:

 

1. Capital Call Finance

  • Loan with recourse to the fund investors (Limited Partners)

  • Diverse pool of LPs consisting of pension funds, insurance companies and endowments

 

 

2. NAV Finance

  • Loan with recourse to the fund’s investments

  • Low LTV loans:
    • 10– 20% (single fund)
    • 30 - 50% (secondaries)
Why Aegon AM for Fund Finance?

 Fund Finance is one of our core capabilities.

Resources and track record
  • Global investment team across Europe and the US.
  • Over €4 bn investments made since 2018.
  • Over €1 bn seed capital raised for upcoming Lux RAIF investment funds.
  • No credit migration to date.
Sourcing and alignment
  • Co-investing next to key strategic investors of Aegon Group.

 

 

 

Product range
  • Capital call and NAV Finance
  • Tailored to institutional investors
  • Investment Grade risk profile
  • Strategic sourcing network through global lending banks  
Overview of our key Fund Finance strategies

At Aegon Asset Management we offer two distinct Fund Finance strategies, each at different stages of the PE fund’s life cycle. Past performance does not predict future returns.

 

 

Capital Call Finance

NAV Finance

Target yield*

3m Euribor + 175 - 250bps

3m Euribor + 225 - 400bps 

Credit quality

AA / A

A / BBB

Weighted average life

Majority of assets have drawn maturities between 3-12 months  

 

Expected WAL: 3 - 5 years

Target Structure

  • Co-investment structures with specialized banks offering access to deal pipeline

  • Loan by loan underwriting while benefiting from strong ‘alignment of interest’ with bank lenders

  • Drawn facilities

  • Co-investment structures with specialized banks offering access to deal pipeline

  • Loan by loan underwriting while benefiting from strong ‘alignment of interest’ with bank lenders

  • Term Loan facilities

Loan Purpose

Working capital to prefund LP commitment drawings

Add on acquisitions (PE Funds) in harvesting phase & Limited Partner distributions

Fund pages

More information >

More information >

 

Source: Aegon AM. As of March 2025.

Disclaimer