Brookfield’s $200 Billion Credit Group Seeks to Lure Insurers *Centurion Insurance AFS*

Brookfield Asset Management’s newly formed credit arm will cater to its parent’s insurance business and will also pitch other insurers on overseeing their assets, the unit’s chief executive officer says.

“What we’ve decided to do is bring all of our credit activities under one umbrella, allowing for increased focus and more growth,” said Craig Noble, who was recently named to lead that effort.

Brookfield Asset expects credit to be its fastest growing business, more than tripling in size over the next five years. The Toronto-based firm is partly relying on credit — including its insurance platform — to reach $1 trillion of fee-bearing assets by 2028, up from $457 billion at the end of last year.

Brookfield Reinsurance Ltd., a separate publicly traded entity that’s controlled by parent Brookfield Corp., is poised to complete its acquisition of American Equity Investment Life Holding Co. in coming weeks, doubling its insurance assets to about $100 billion. Noble’s team will manage the majority of that money.

Noble’s credit unit oversees $200 billion in total, including Brookfield’s infrastructure and real estate lending funds, as well as partnerships with Oaktree Capital Management, European credit manager LCM Partners, Primary Wave and 17Capital.

“One of our growth areas is to manage larger portions of balance sheets for insurance companies and other institutions,” Noble said, adding that the unit has been doing that for Brookfield Re and, increasingly, for third-party insurance companies.

The unit’s investment strategies also include “insurance solutions” such as investment-grade debt, structured finance and asset-backed financing, Noble said. But private credit and direct lending remain the biggest part of the business, comprising 80% of fee-revenue last year.

Alternative-asset managers have been pushing into areas beyond traditional buyouts after rising interest rates made borrowing costlier. That has contributed to a stampede toward private credit, which jumped in to fill a lending void as traditional banks retrenched. Private equity firms have also been acquiring stakes in insurers to influence how they invest and grow their balance sheets.

Photograph: The Brookfield Asset Management logo on a smartphone arranged in New York, US, on Wednesday, Nov. 8, 2023. Photo credit: Gabby Jones/Bloomberg

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