Q: I get that Bn doesn’t have same credit risk exposures as many of the private credit providers but I wonder if Bn is effected if these companies such as Apollo, can no longer participate in new projects as their outflows may be too high. I believe Bn doesn’t provide 100% funding for its large investments but comes in as one of a group of players, if other players are stepping back will Bn have to slow its rate of investment?
5i Research Answer:
It is a possibility. BN certainly does not often take 100% of a deal. But, it does have global partners, and there is usually enough parties to a deal. If not typical credit companies, then government agencies certainly would not have the same limitations. But it is possible that if credit continues to deteriorate then growth could slow. Offsetting this, though, may be higher returns on the deals it does participate in (as valuations has adjusted downward).