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The Growth of Private Lending and Retail Access to Alternative Investments

Author

Listed:
  • David T. Robinson
  • Melanie Wallskog

Abstract

Private lending has exploded recently, owing not only to the retreat of banks from corporate lending, but also to the expansion of private equity (PE). Given the growing interest in retail access to alternative assets, we explore fees, performance, and investment behavior for publicly traded Business Development Companies (BDCs). Their compensation structures include fees and provisions common in PE, and they collectively provide debt for PE-sponsored deals and make PE-like investments themselves, especially for higher-spread investments. In-sample risk-adjusted abnormal returns are high, but fees and performance are inversely related. Moreover, BDCs with larger non-institutional investor bases charge higher fees.

Suggested Citation

  • David T. Robinson & Melanie Wallskog, 2026. "The Growth of Private Lending and Retail Access to Alternative Investments," NBER Working Papers 34617, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:34617
    Note: CF PR
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    More about this item

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage

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