The Briefing on Private Banker International
For this issue The Briefing takes a look at recent data on private equity. The alternative asset class is increasingly popular among family offices and HNWIs.
of HNW entrepreneurs prefer private equity when making direct investments. The results are from BNP Paribas’ Entrepreneur Report 2019, which found the highest take-up of the asset class among entrepreneurs in India, Russia, Spain and the GCC.
39 years old
Is the average age of an entrepreneur who invests in private equity according to BNP’s report. Most – 27% - rely on a wealth manager or financial advisor for their exposure to private equity investments. Just 9% invest through family offices.
Is the average portion of a family office portfolio allocated to private equity according to Sandaire Family Office. The multi-family office currently has around £260m invested in private equity and rising.
of family offices’ private equity investments met or exceeded their performance expectations according to The Global Family Office Report 2018 by UBS and Campden Family Office. Those investing in Europe were most pleased: There, only 10% of investments under-performed.
of private equity deals produced healthy returns between 2002 and 2005 compared to roughly 20% between 2010 and 2013, an analysis by Cambridge Associates and Bain & Company showed.
Four-fifths of private equity financing deals this year were written with loose covenants according to credit rating agency Moody’s. This compares with one-fifth in 2007 before the financial crises. Moody’s warned that this could hamper recovery rates for investors in the next downturn.
The total amount expected to be invested in private equity by 2023 as estimated by Preqin. The data provider says that private equity will overtake hedge funds as the largest alternative asset class within the next five years.