Japanese financial group Mitsubishi UFJ (MUFG) Bank, alongside its trust banking arm, has expanded further into alternative investments with the launch of a new US direct lending fund.
The MUFG US Direct Lending Fund I has been established for domestic institutional investors and will focus on lending to mid-sized companies in the US. The fund will invest in senior loans originated by Mitsubishi UFJ Bank, aiming to deliver “middle risk and middle return” through diversified exposure to direct lending assets.
MUFJ said the fund was launched in response to strong growth in the US private credit market and rising demand from institutional investors amid increasing uncertainty in the investment environment.
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While private credit funds have historically been the most active participants in US direct lending, while traditional banks have played a more limited role due to regulatory constraints.
The move forms part of MUFG trust and banking corporation’s broader push into alternative assets. The group began building its merger and acquisition (M&A) finance platform with a fund focused on Oceania in 2022, followed by the launch of a domestic M&A finance fund in 2023.
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The new vehicle is the third fund established within its M&A finance strategy and marks its first dedicated direct lending fund focused on the US.
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