The Growth of Private Lending and Retail Access to Alternative Investments
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.
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Copy CitationDavid T. Robinson and Melanie Wallskog, "The Growth of Private Lending and Retail Access to Alternative Investments," NBER Working Paper 34617 (2026), https://doi.org/10.3386/w34617.Download Citation
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