Traci Alloway

I think institutionally you had in the LBO world, sponsors were looking to have a real partner that they could go to repeatedly for all different types of transactions, go back to them.

again and again and develop a real relationship and where they or their lender could be very expedient as well.

And I think expediency mattered in providing with sort of that guaranteed financing, which the banks were providing up until they were squeezed out from a regulatory standpoint on the most highly levered transactions.

And I think that's what it really kind of comes down to is the ability to provide more leverage than the banks were allowed to without running afoul of the regulators.

We currently actually right now don't have any private credit.

We were involved in it in the past, but I think most of those opportunities have gone to the dedicated private

private credit funds, because one of the structural differences of the way they're set up versus the way we're set up is we source our ideas mostly from investment banks.

Now, some of those investment banks used to come to us with transactions that weren't going to fly in the public market.

So they would look and say, this is a small deal.

We're not going to be able to find buyers from this among our

Investors who are primarily benchmark high-yield investors because it would be outside the index and it would be illiquid And there's been a lot of talk about and problems with investing in illiquid securities One of the real benefits of our strategy is we always have lots of liquidity We have a historically have managed our portfolio in a short duration with a short duration focus that creates cash and we keep a lot of front-end and

ballast.

So as our portfolio is always creating cash, we could invest in some pockets of less liquid strategies, but we haven't done that.

The private credit guys are set up differently.

They need a team of bankers to go out and source all their deals.

They have to knock on companies' doors.

It's a very different way in their function of having to source their transactions to try to fill up the asset side of their portfolios.

So because of that, over time, I think

there's a huge structural difference between the way they approach it and the way we approach it.

But just going back briefly to the insurance company side, insurance companies have long been investors in private assets and they used to have large teams of private debt investors.