KPMG Luxembourg, in collaboration with ALFI, are pleased to present the seventh edition of the Private Debt Fund Survey.

This year's publication provides unique insights into the thriving private debt market from a Luxembourgish perspective. Despite global economic challenges, the private debt asset class has continued to grow, becoming an essential part of investors' portfolios.

Britta Borneff

Director of Events, Communications and Business Development

Read foreword

Private debt remains an attractive investment opportunity. This is confirmed by the latest Private Debt Fund Survey conducted by KPMG, showing that investor appetite for private debt funds has continued to grow. Over the past 12 months, assets under management grew by 51%, from EUR 267.8 billion in June 2022 to EUR 404.4 billion in June 2022.

The survey results reveal some interesting observations. Firstly, the prevailing geopolitical and macroeconomic environment remains turbulent, marked by high interest rates and inflationary pressures. This dynamic presents both opportunity and challenge for the private debt market. While high interest rates typically favor private credit managers when prudent lending decisions are made, higher interest rates and inflationary forces can exert significant pressure on borrowers. As a consequence, the looming threat of payment defaults persists.

Furthermore, the transformative impact of ESG and sustainability regulations on private debt fund managers and the broader investment industry is not a recent development. In current months, European asset managers have been actively re-examining their investment strategies to align with the Sustainable Finance Disclosure Regulation (SFDR). Survey findings indicate a lasting commitment to ESG strategies, likely influenced by the growing market demand and the need to integrate ESG factors into decision-making processes and product development.

The use of technology is becoming a pivotal factor not only in addressing sustainability and ESG requirements but also in driving success in the private debt market on other fronts. Tokenization, blockchain and most recently AI are expected to influence increasingly the investment life cycle and, when it comes to the private debt market, they are expected to influence both the access of retail investors and the increase of liquidity.

Lastly, a noteworthy trend emerges in the survey findings – the remarkable popularity of RAIFs, now leading Luxembourg's debt fund market at 53%, surpassing SIFs (38%). Continuing the trend from the previous year, there is an 8% increase in the proportion of debt funds established through RAIFs, while SIFs show a decline of 11%. This trend is expected to continue in the coming years, confirming that qualified investors appreciate the flexibility brought by this collective investment structure and its considerably fast time- to- market.

I would like to express my sincere gratitude to the KPMG team for their invaluable support and to the numerous market participants who actively contributed to this year's survey. Their involvement has been instrumental, and we truly appreciate it. Thank you on behalf of the ALFI.

Julien Bieber

Partner Tax, Alternative Investments
& Co-Head of Private Debt
KPMG Luxembourg

Valeria Merkel

Partner Audit, German Asset Management
& Co-Head of Private Debt
KPMG Luxembourg

Read introduction

By confirming its ability to generate stable and consistent returns across legion of different challenges, the Luxembourg private debt market has continued to ride a wave of growth this year.

Throughout the geopolitical uncertainties, the rising interest rates and growing inflationary pressure, the Luxembourg private debt funds market has shown much more than a strong resilience and reflects an impressive growth of more than 50% of Assets Under Management (AuM)1 with the market now reaching more than €400 billion AuM2.

The current environment is certainly leading to a continued growth of the private debt market which also became a major source of capital for new acquisitions. Private debt assets have more than ever penetrated the vast majority of investors’ portfolio. While rigorous portfolio management remains key to success, private lending has proved itself as fairly crisis resistant and immune to inflation as it largely relies on floating rate characteristics and shorter maturities than traditional fixed income instruments.

In line with the last couple of years’ survey, unregulated special limited partnerships (SCSp) and reserved alternative investment funds (RAIF) remain private debt managers’ Luxembourg fund vehicles of choice.

While the Luxembourg SCSp continue to run the show as preferred unregulated private debt funds set up with 85% of the market, the Luxembourg RAIF has again increased its market dominance and is now representing more than half (53%) of the indirectly supervised private debt funds, boosting another 8% increase this year compared to June 2022.

Unregulated but indirectly supervised funds seem to close the gap with the regulated funds market in Luxembourg (+2% of market share for the unregulated set up compared to last year).

The EU remains the top geographical target for investments, favored by 42% of our respondents, with other European countries (29%) and North America (13%) completing the podium. Investors in Luxembourg private debt funds remain largely institutional investors (81%) mainly coming from the European Union (46.5%).

When it comes to regulation, the European long-term investment fund (ELTIF) Regulation as well as the second Alternative Investment Fund Manager Directive (AIFMD 2) will require additional monitoring and diligence from private debt market players and depositaries.

With a view of proposing a new framework of common minimal rules for loan-originating funds, the AIFMD 2 is still being discussed at EU level, but agreement appeared to be reached on most topics, with some technical items still being finalized.

While the EU is still developing its framework for loan-originating funds, fund managers can already avail of the ELTIF Regulation. Initial requirements of ELTIF Regulation are currently being reviewed by the EU which should offer more alluring option to loan-originating fund managers for retailization. Although the influence of this ELTIF 2.0. regulation is not yet reflected in this year’s figures for retail investors (8%), one can expect this to boost the retailization in coming years although there is still a wait and see approach from fund managers in this respect.

On the other hand, digitalization and blockchain technology remain on top of the priority list of investors to revolutionize the private debt market in the next few years and potentially increasing the asset class’s liquidity while reducing costs and investments barriers to retail investors.

Since the beginning of 2023, asset managers faced the wave of reporting obligations coming from the Sustainable Finance Disclosure Regulation level 2 (SFDR 2) application while in parallel addressing more regulatory scrutiny focusing on sustainability risk and reporting process. More than ever, private debt fund managers have been integrating environmental, social, and governance (ESG) factors into their decision-making process.

While this survey found that most funds (76%) are classified under SFDR Article 6 (i.e., funds not integrating any kind of sustainability into their investment process), we expect ESG scrutiny to progressively leads to an increase of the level of Article 8 and Article 9 funds in the next future. The SFDR 2 Regulation should provide the industry with the clarity it needs to move forward.

Before we sign off, we would like to thank everyone who took part in the 2023 private debt fund survey, especially the depositaries and market players of this vibrant ecosystem who inspired us in our discussions.

And with that, we leave you to discover the full report.

1. Average growth between June 2022 and June 2023 based on data provided by depositaries surveyed.

2. Total assets under management based on data provided by depositaries surveyed. This does not cover all the market and only includes regulated funds and indirectly supervised investment vehicles, such as RAIF, SIF or SCSp AIF.

  • 404.4
    EUR billion total AuM*
  • + 51%
    average growth of AuM compared to last year**
  • + 8%
    growth of the RAIF***
    (compared to 2022)

*Based on data provided by depositaries surveyed. This does not cover all the market and only includes regulated funds and indirectly supervised investment vehicles, such as RAIF, SIF or SCSp AIF.

**Average growth between June 2022 and June 2023 based on data provided by the depositaries surveyed.

***RAIFs now dominate Luxembourg’ debt fund market at 53% as of June 2023.

A snapshot of the private debt fund market

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Further reading

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About this research


This study has two main objectives:

  • Interpret current behaviors and structuring trends in private debt funds in Luxembourg and predict where they are headed.
  • Provide qualitative insights based on numerical data.


We received data from 12 depositaries acting on the market and representing 1,495 funds (or sub-funds) investing in private debt. We sent a pre-defined questionnaire to each depositary surveyed to gather data on the various debt funds they are in charge of.

This questionnaire of 38 closed-ended questions covered various topics, such as the fund category, their regulatory regimes, legal forms, sizes, geographical investment targets, investors’ origins, and even data regarding the financial statements.

The following depositaries/depositary banks were surveyed:

  • Alter Domus
  • Brown Brothers Harriman Luxembourg
  • BNP Paribas, Succursale de Luxembourg
  • The Bank of New York Mellon
  • Citco Fund Services
  • Citibank Europe
  • Edmond De Rothschild Asset Management
  • J.P. Morgan Bank
  • HSBC Continental Europe
  • UBS Europe
  • State Street Bank
  • Banque de Luxembourg


The survey’s key findings are disclosed in this report on a no-name basis. Research for this survey was carried out from July 2023.

Meet our team

Valeria Merkel

Valeria Merkel

Partner Audit,
Public and Private Asset Management
& Co-Head of Private Debt,
KPMG Luxembourg

Email ›View profile ›

Julien Bieber

Julien Bieber

Partner Tax,
Alternative Investments
& Co-Head of Private Debt,
KPMG Luxembourg

Email ›View profile ›