BNP Paribas Creates Private Assets Unit; Sector's Growth Continues

Editorial Staff

14 December 2022

has created a new business unit called Private Assets, which sits in its Investment and Protection Services division (including asset management, wealth management, insurance and real estate).

The French firm’s move comes at a time when investment in non-listed asset classes such as venture capital, private credit and infrastructure, continue to gain interest because of the superior yield that is typically the reward for lower liquidity. A secular shift away from listed to unlisted companies has also driven demand for investment capabilities in the space.

The new business area will be operational in January. It blends private asset management expertise across IPS and will work with BNP Paribas Corporate & Institutional Banking and the group's distribution networks, BNP Paribas said in a statement yesterday.

The private assets unit will account for more than €30 billion ($31.6 billion) of assets under management and advisory, the bank and investment group said.

The bank said the new unit will be led by David Bouchoucha, who will report to Sandro Pierri, chief executive for BNP Paribas Asset Management.

According to the EY 2021 Global Wealth Research Report, 42 per cent of investors are considering increasing their holding of alternative assets in their portfolio, a figure which is up from 37 per cent in 2019. One in three clients already has alternative assets in their portfolio and this level is expected to rise to 48 per cent by 2024. Across all asset classes, private markets have grown to around five times the level they were at in 2007. Over the same period, public markets have seen two times growth. The absolute value of investment in each is vastly different – public markets represent around $125 trillion of capital compared with $9.8 trillion of private market capital.