This is a sponsored article from Apollo Global Management.

Capital drives economies around the world, and Apollo Global Management aims to lead in delivering innovative capital solutions to borrowers in private and public markets.

Over the past 15+ years, investors have increasingly turned to private credit as a core component of their portfolios. Building on that momentum, we’re seeing growing interest in asset-backed finance (ABF) as a complementary strategy to corporate lending. ABF offers the potential for portfolio diversification and risk mitigation – alongside steady income backed by a broad range of financial or tangible assets.

Unlocking a US$20 trillion-plus market opportunity ^[1]

In our view, ABF is the next evolution of private credit. It has long been a foundational tool for financing the everyday needs of businesses and consumers around the world – spanning commercial and residential mortgages, equipment, aviation, automotive fleet and more. Many are physical assets with substantial value that are also cash-flow producing – for example, a fleet of cars that are used by corporates. With an addressable market exceeding US$20 trillion, we believe ABF represents a significant and timely opportunity¹.

Historically, access to ABF was primarily through the public markets. In recent years, however, private ABF has grown significantly, as borrowers have increasingly turned to non-bank lenders like Apollo for more flexible and tailored financing solutions.

For instance, Apollo financed one of the largest ever and highest-rated music royalties asset-backed securitisation in recent years. We also served as the financing partner of choice for major corporations like Air France-KLM, providing capital backed by a variety of high-quality assets, including spare engines, MRO components and even contracts related to its loyalty programme. The asset-backed nature enabled Apollo to provide highly structured solutions at attractive costs of capital.

Potential benefits of ABF for borrowers and lenders

For investors, the evolving ABF market can be attractive because it offers the potential for cash flow stability, lower volatility, diversification, and lower correlation to corporate credit due to the nature of its underlying structures:

• Highly diversified underlying assets: Each ABF transaction can be backed by thousands of individual loans, significantly reducing or eliminating single points of failure.
• Naturally cash-flowing structures: These portfolios generate contractual cash flows, providing a steady and predictable income stream.
• Lower correlation to broader markets: ABF investments are typically investment grade, resulting in lower correlation to broader credit and equity market gyrations.
• Strong risk-adjusted returns: ABF touches all sectors of the economy, offering robust risk mitigation and the potential for excess returns.

What sets us apart: Origination platforms in action

At Apollo, we differentiate ourselves through managing investments in a network of more than 30 origination platforms and partnerships, spanning a broad range of asset types – from aircraft leasing to auto fleet financing and beyond. Through direct origination, we can benefit from a significant sourcing and informational edge, gaining access to high-quality opportunities to invest in at our own discretion. Each platform contributes deep, asset-level expertise, enhancing our collective ability to assess risk and value across market cycles.

Our value proposition is grounded in deep expertise and the ability to deliver flexible capital solutions across the full spectrum of the capital structure for companies around the world. We are frequently the largest investor in transactions we originate, underwrite, and structure – often with the intention of holding them in perpetual capital vehicles. To us, this represents the strongest form of alignment.

For example, we believe our alliance with the PK AirFinance platform positions the Apollo ecosystem as a trusted, go-to lender in the aviation industry. Backed by deep subject matter expertise and top-tier execution, we’ve built strong relationships across the sector – serving more than 80 airlines in over 40 countries.

Apollo Funds’ investments in asset origination platforms:

Being a trusted partner

The ABF market represents a US$20 trillion-plus opportunity – broad, scalable, and increasingly essential to the global economy. At Apollo, we believe that our ability to combine flexible capital and deep structuring expertise with access to origination platforms uniquely positions us to capitalise on this growing and underutilised segment of private credit.

With approximately US$785 billion in total assets under management (AUM) – including US$641 billion² in credit – Apollo manages the largest credit platform among leading alternative investment firms.³ In ABF specifically, we bring nearly two decades of experience, with ~US$246 billion in AUM and ~US$360 billion deployed over the past 17 years.⁴

“At Apollo, we view Asset-Backed Finance as a differentiated asset class – combining scale, diversification, innovation, and alignment to unlock one of the largest untapped opportunities in global finance.”

– Edward Moon, Partner and Head of Asia Pacific Global Wealth Management

For more insights from Apollo, visit www.apollo.com.
 

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Footnotes
¹ Source: Apollo Analysts as of December 2022.
² AUM figures as of March 31, 2025
³ Peer AUM figures are from company filings as of December 31, 2024. The peer group includes asset managers (Blackstone, Ares, Carlyle, KKR, and Oaktree) with similar multi-asset and private credit platforms but is not exhaustive. Peer selection is subjective and may vary based on market assessment. Subject to change at any time.
⁴ Reflects total asset-backed deployment through December 31, 2024.

IMPORTANT INFORMATION:
This material is provided for informational and discussion purposes only and does not constitute an offer to sell, or the solicitation of an offer to buy, any security, product or service. The views and opinions in this article are of the authors of the content and are subject to change at any time without notice. There can be no assurance that an investment strategy will be successful. Historic market trends are not reliable indicators of future market behaviour or future performance. The information contained herein is not intended to provide, and should not be relied upon for, accounting, legal or tax advice or investment recommendations. Actual events or results may differ materially from those reflected or contemplated herein.

Apollo has not made any representation or warranty, expressed or implied, with respect to fairness, correctness, accuracy, reasonableness, or completeness of any of the information contained herein, and expressly disclaims any responsibility or liability therefore.

This is a sponsored article from Apollo Global Management.