Jefferies Credit Partners Raises $4B for European Direct Lending Strategy

Jefferies Credit Partners has secured approximately $4 billion in lending capacity for its European institutional direct lending strategy. This move marks an expansion of the firm's private credit platform into the European market.

This capital capacity includes the initial fund close, two additional partnership accounts scheduled to close later in 2026, and access to internal balance sheet capital. The strategy is anchored by commitments from Allianz Global Investors, with further investment participation from the South Carolina Retirement System Investment Commission.

"With an experienced investment team and an embedded footprint through Jefferies’ EMEA Investment Banking franchise, we are positioned to source high-quality opportunities and replicate the success of our U.S. strategy," said Tom Brady, President of Jefferies Finance.

Scaling Private Credit in Europe

The move follows an industry trend where investment banks use their balance sheets and institutional relationships to compete with private equity-backed credit managers.

"The strong investor support for this first close reflects confidence in our team, our sourcing model and the opportunity set ahead," said James Pearce, Head of European Direct Lending at Jefferies Credit Partners.

Understanding Direct Lending Mechanisms

Direct lending is a form of financing where non-bank entities provide loans directly to corporate borrowers instead of using a syndicated bank process. These loans offer higher potential yields to investors than traditional bank financing. They also carry higher credit risk and lower liquidity, as the instruments are not traded on public secondary markets.

"We are pleased to partner with Jefferies Credit Partners on the launch of its inaugural European Direct Lending Fund," said Joaquin Ardit, Lead Portfolio Manager at Allianz Global Investors.

Strategic Importance

For Jefferies, this expansion integrates its existing European investment banking franchise with a dedicated credit arm. This allows the firm to provide a suite of financial services to corporate clients. The involvement of large institutional partners like Allianz shows the demand for private credit exposure among pension funds and insurance companies that want to diversify away from traditional fixed-income assets.