Investor interest in European private credit, particularly direct lending, accelerates in 2025 amid US market saturation concerns and increased European strategic spending, signalling a potential long-term rebalancing of global private capital flows.
Investor interest in European private credit, particularly direct lending, is gaining significant momentum in 2025, marking a notable shift in the landscape of private capital deployment. According to Pemberton Asset Management, a leading player in this sector with $28.8 billion under management, direct lending volumes across Europe surged to €84.9 billion (£74.3 billion) in the first nine months of 2025, already surpassing the €74.4 billion recorded in the same period of 2024. This data suggests investor sentiment is increasingly favouring Europe amid concerns of saturation in the US private credit market.
Fundraising activities reflect this trend vividly. Pemberton reported that direct lending fundraising in Europe during the first three quarters of 2025 has exceeded the total for the entirety of 2024, positioning European annual totals to potentially exceed the recent range of $35 billion to $40 billion. PitchBook data supports this view, indicating Europe’s share of global private capital grew from 20.4 percent in 2024 to 32.4 percent in the first half of 2025, while the US share declined marginally to 69.9 percent. Notably, the ratio of private equity to private credit dry powder in Europe reached an impressive 2.85 times as of Q3 2025, suggesting ample capital ready for deployment in the private credit space.
Pemberton attributes this regional rebalancing partly to a “warming” investor attitude towards Europe, spurred by more assertive US trade policy and increased European government commitments to defence spending. Germany’s recent announcement of a €500 billion fiscal package, which includes a €150 billion ‘Security Action for Europe’ loan programme, exemplifies this pivot. The European Investment Bank’s prioritisation of defence in its agenda further underscores the strategic focus on Europe.
Meanwhile, some US-based allocators perceive the US private credit market, especially mid-market direct lending, as increasingly saturated after years of intense fundraising, driving them to consider alternative regions like Europe. This viewpoint is consistent with industry concerns about the maturity and saturation of segments within the US market.
Pemberton itself recently completed a highly successful €8.4 billion fundraising cycle for its direct lending strategies, comprising €6.1 billion for two senior loan funds closed in 2025, and €2.3 billion for its Strategic Credit Fund III closed in 2024. These figures not only exceeded previous fundraising targets but also signify rising investor appetite for private credit. In 2024, Pemberton deployed €4.6 billion across these strategies, focusing on asset-light, high-performing mid-market companies in sectors such as technology, outsourced business services, biotech, and life sciences.
Further reflecting the surging North American interest in European private credit, Pemberton has established a New York office and appointed a senior team to support US and Canadian institutional investors keen on gaining exposure to Europe’s mid-market credit opportunities. This expansion aims to facilitate closer collaboration and address the growing demand for specialised financing solutions like NAV financing and GP-led transactions.
Taken together, these developments point to what Pemberton describes as the “early stages of a longer-term tilt towards Europe” in private credit investing. If this trend continues, Europe could become an ever more significant player in global private credit markets, offering investors diversification beyond the increasingly crowded US environment and aligning with broader geopolitical shifts within investment and defence priorities.
- https://alternativecreditinvestor.com/2025/11/28/tilt-towards-europe-as-private-credit-fundraising-surges/ – Please view link – unable to able to access data
- https://alternativecreditinvestor.com/2025/11/28/tilt-towards-europe-as-private-credit-fundraising-surges/ – Investor sentiment towards Europe is strengthening, with fundraising for direct lending rising sharply in 2025 and deal volumes on track to hit fresh records, driven by fears the US market is becoming saturated, Pemberton has said. Direct lending volumes reached €84.9bn (£74.3bn) in the first nine months alone compared with €74.4bn in the first three quarters of 2024, showing that investor sentiment is swinging towards Europe, the $28.8bn (£21.8bn) manager said in a report. Alongside this, direct lending fundraising in the first three quarters of 2025 has already surpassed the total for the whole of 2024, putting Europe on track to lift annual totals above the recent $35bn–$40bn range, it said. PitchBook data shows that in 2024, Europe accounted for just 20.4 per cent of global private capital raised, compared with 75.4 per cent in the US. But in the first half of 2025, Europe’s share climbed to 32.4 per cent, while the US has slipped slightly to 69.9 per cent. Pemberton also highlighted that the ratio of private equity to private credit dry powder in Europe now stands at 2.85 times as of the third quarter. The manager said the combination of fundraising momentum, rising deployment and ample dry powder suggests the “early stages of a longer-term tilt towards Europe are under way”. It attributed the shift partly to “warming” investor sentiment towards Europe in response to more assertive US trade policy. At the same time, European governments have also indicated that they will increase defence investment. Germany’s new €500bn fiscal package, supported by a €150bn ‘Security Action for Europe’ loan programme, reflects that shift, while the European Investment Bank has also placed defence at the top of its agenda. Pemberton added that some allocators now view the US as less attractive after several years of heavy fundraising across private credit strategies, with signs that parts of the market, particularly mid-market direct lending, may be approaching saturation.
- https://pembertonam.com/news/pemberton-completes-successful-e8-4bn-direct-lending-fundraise-cycle/ – Pemberton Asset Management, one of Europe’s leading private credit managers, today announces the successful completion of its Direct Lending fundraising cycle, exceeding targets with a total of €8.4bn. The cycle includes the final close of Pemberton’s two senior loan funds at €6.1bn in 2025 as well as the Strategic Credit Fund III with its final close at €2.3bn in 2024. The latest vintages across the three funds all exceeded the size of the previous funds, which evidences the growing investor appetite for the asset class and reinforces Pemberton’s position as a leading European private credit manager. Pemberton’s Direct Lending strategies offer flexible, multi-product financing solutions to meet the growing needs of leading private equity sponsors and mid-market companies in Europe, as reflected by substantial deployment levels of €4.6bn across the three direct lending strategies in 2024.
- https://www.sfnet.com/home/industry-data-publications/the-secured-lender/tsl-express-daily-articles-news/tsl-express-daily-articles-news/2025/05/12/pemberton-completes-successful-8.4bn-direct-lending-fundraise-cycle – Pemberton Asset Management, one of Europe’s leading private credit managers, today announces the successful completion of its Direct Lending fundraising cycle, exceeding targets with a total of €8.4bn. The cycle includes the final close of Pemberton’s two senior loan funds at €6.1bn in 2025 as well as the Strategic Credit Fund III with its final close at €2.3bn in 2024. The latest vintages across the three funds all exceeded the size of the previous funds, which evidences the growing investor appetite for the asset class and reinforces Pemberton’s position as a leading European private credit manager. Pemberton’s Direct Lending strategies offer flexible, multi-product financing solutions to meet the growing needs of leading private equity sponsors and mid-market companies in Europe, as reflected by substantial deployment levels of €4.6bn across the three direct lending strategies in 2024.
- https://www.crowdfundinsider.com/2025/05/239545-pemberton-asset-management-announces-completion-of-e8-4b-direct-lending-fundraise-cycle/ – Pemberton Asset Management, one of Europe’s private credit managers, announces the successful completion of its Direct Lending fundraising cycle, exceeding targets with a total of €8.4bn. The cycle includes the final close of Pemberton’s two senior loan funds at €6.1bn in 2025 as well as the Strategic Credit Fund III with its final close at €2.3bn in 2024. The latest vintages across the three funds all exceeded the size of previous funds, showing growing investor appetite for private credit. Pemberton’s three direct lending strategies deployed €4.6bn last year, providing financing solutions to private equity sponsors and mid-market companies across Europe. The strategies primarily target asset-light, high-performing companies in the core mid-market, particularly in sectors like technology, outsourced business services, biotech, and life sciences.
- https://alternativecreditinvestor.com/2025/05/12/pemberton-am-raises-e8-4bn-for-direct-lending-strategies/ – Pemberton Asset Management has raised €8.4bn (£7bn) in its latest fundraising cycle for its three direct lending strategies. This includes two senior loan funds, which closed in 2025 at €6.1bn, and its Strategic Credit Fund III, which closed at €2.3bn in 2024. The vintages across the three funds all exceed the size of previous funds, showing growing investor appetite for private credit. Pemberton’s three direct lending strategies deployed €4.6bn last year, providing financing solutions to private equity sponsors and mid-market companies across Europe. The strategies primarily target asset-light, high-performing companies in the core mid-market, particularly in sectors like technology, outsourced business services, biotech, and life sciences.
- https://www.sfnet.com/home/industry-data-publications/the-secured-lender/tsl-express-daily-articles-news/tsl-express-daily-articles-news/2025/06/13/pemberton-expands-to-meet-north-american-investor-appetite-for-european-private-credit – Pemberton Asset Management, one of Europe’s leading private credit managers, has today announced a series of senior North American appointments, alongside the establishment of a New York office. These hires mark a significant expansion of the firm’s North American presence as well as meeting increasing demand from U.S. and Canadian institutional investors seeking access to European mid-market opportunities. Pemberton’s expanded North American team will operate out of its New York office to enable deeper collaboration with U.S. and Canadian investors, building on the firm’s disciplined track record as a trusted partner for mid-market European credit. Pemberton’s senior North American team bring deep expertise in capital markets and institutional capital raising and reflect the growing demand for NAV Financing, GP-led solutions, and European private credit opportunities.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative presents recent data on European private credit fundraising, with direct lending volumes reaching €84.9bn in the first nine months of 2025, surpassing the €74.4bn recorded in the same period of 2024. This suggests a fresh perspective on the trend. However, similar information was reported in May 2025, indicating that while the data is current, the underlying trend has been previously reported. ([alternativecreditinvestor.com](https://alternativecreditinvestor.com/2025/05/12/pemberton-am-raises-e8-4bn-for-direct-lending-strategies/?utm_source=openai))
Quotes check
Score:
9
Notes:
The report includes direct quotes from Pemberton Asset Management, such as:
> “The combination of fundraising momentum, rising deployment and ample dry powder suggests the early stages of a longer-term tilt towards Europe are under way.” ([alternativecreditinvestor.com](https://alternativecreditinvestor.com/2025/11/28/tilt-towards-europe-as-private-credit-fundraising-surges/?utm_source=openai))
These quotes appear to be original, with no exact matches found in earlier material.
Source reliability
Score:
7
Notes:
The narrative originates from Alternative Credit Investor, a publication focusing on alternative credit markets. While it provides detailed information, the publication’s reputation and editorial standards are not widely known, which introduces some uncertainty regarding its reliability.
Plausability check
Score:
8
Notes:
The claims about the surge in European private credit fundraising align with broader industry trends and are supported by data from reputable sources like PitchBook. The narrative also references Pemberton Asset Management’s recent activities, such as the completion of a €8.4bn direct lending fundraising cycle in May 2025. ([alternativecreditinvestor.com](https://alternativecreditinvestor.com/2025/05/12/pemberton-am-raises-e8-4bn-for-direct-lending-strategies/?utm_source=openai)) However, the report’s reliance on a single source for these claims and the lack of corroboration from other reputable outlets slightly reduce its overall credibility.
Overall assessment
Verdict (FAIL, OPEN, PASS): OPEN
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The narrative presents current data on the surge in European private credit fundraising, with direct lending volumes reaching €84.9bn in the first nine months of 2025, surpassing the €74.4bn recorded in the same period of 2024. While the data is recent, similar trends have been reported earlier in the year, indicating that the underlying information is not entirely new. The inclusion of direct quotes from Pemberton Asset Management adds originality, but the reliance on a single, less-known source for the majority of the information introduces some uncertainty regarding the report’s reliability. Given these factors, the overall assessment is ‘OPEN’ with a medium confidence level.