Asia’s private debt market has gained increased investor attention in recent years. While private debt fundraising peaked in 2019 before a hiatus during the COVID-19 pandemic, direct lending dry powder levels are now steadily on the rise, with an estimated US$1.9 trillion globally as of October 2021.

In addition, companies seeking to diversify their funding sources are showing a pent-up demand for capital. As economic conditions improve, these factors should continue to fuel growth in this nascent asset class in the Asia-Pacific region. At a discussion hosted by Latham & Watkins partner Howard Lam at the 2021 Debtwire Asia-Pacific Forum, panelists analyzed the direct lending landscape in the region, including the drivers behind its growth and the opportunities and challenges that direct lending presents for those active in the space.