A new report from the Managed Funds Association (MFA) reveals that private credit funds provided nearly $560 billion in new loans to U.S. businesses over the past three years, playing a crucial role in creating over 6.5 million jobs. This substantial lending is estimated to have generated approximately $897 billion in economic activity across the United States since 2023, with California, Illinois, and Texas accounting for the largest shares. The Washington, D.C.-based MFA, representing the global alternative asset management industry, compiled its findings from an analysis of private credit and hedge fund investment data sourced from BlackRock’s Preqin and various federal datasets.
The report underscores the critical role alternative asset managers play in financing businesses and the broader economy, a sector that has expanded rapidly over the last decade as investors increased allocations to private markets. This growth has been particularly pronounced as traditional lenders retrenched from financing riskier loans in recent years due to stricter regulations. Private credit firms have effectively stepped in to fill this financing void, providing essential capital. MFA CEO Bryan Corbett commented, “Alternative asset managers provide a meaningful contribution to the U.S. economy and everyday Americans. Regulators should continue fostering a regulatory framework that encourages these benefits nationwide.”
Beyond private credit, the MFA report also detailed significant allocations to hedge funds by institutional investors. Pensions, university endowments, and non-profit foundations across the U.S. have collectively committed approximately $1.6 trillion to hedge funds as they seek to fund long-term financial commitments. These institutional investors utilise hedge funds to diversify their portfolios and generate stable long-term returns. Pensions led the way with $940 billion invested in hedge funds, while non-profit foundations invested $510 billion. New York, California, and Texas emerged as the top states for these institutional hedge fund allocations.
