Andrew Torrington Speaking with ausbiz on ASIC Private Credit Review

Watch the full ausbiz interview here

Key points:

• ASIC releases significant review, raising standards in private credit

• Risk and fee transparency improvements are vital for investor protection

• Private credit sector forecasted for continued strong growth

• Woodbridge Capital favours conservative real estate lending in major cities

The Australian Securities and Investments Commission (ASIC) has published a critical review of private markets and private credit, introducing new regulatory expectations for the sector. Andrew Torrington of Woodbridge Capital sees this move as largely positive, stating that regulation is much needed and overdue. Torrington points out that, although ASIC is not fully where it needs to be, the majority of recommended reforms have been addressed, with the industry now placed firmly on notice. He expects the increased scrutiny to prompt some funds to act swiftly to improve their risk transparency and fee disclosure, especially in the interests of protecting retail investors.

Torrington believes investors must take greater care to understand both the risks and returns of private credit investments, insisting that transparency in this sector is not as high as it should be. He underscores the need for investors to only engage with funds where risks are visible and where they can make informed decisions. While some funds may feel pressure following ASIC’s findings, Torrington maintains there will be continued and fast growth in private credit due to a global shift towards private markets.

At Woodbridge Capital, Torrington outlines a focus on Australian and New Zealand real estate, favouring first mortgage loans and emphasising a conservative approach. Despite challenges in markets like Melbourne, he maintains a bullish outlook on real estate values and feels well-placed for ongoing lending, noting the robust fundamentals and lower sensitivity to interest rate movements in commercial real estate.