Australian regulator moves to ease private credit disclosure rules for superfunds

The Australian Securities and Investments Commission (ASIC) has proposed giving superannuation funds relief from disclosing granular details of their private credit investments, warning that current rules risk breaching commercial confidentiality.

In a call for feedback paper released today (28 November), the regulator said it is considering a class order that would scale back portfolio-holding disclosure requirements for trustees on internally managed private debt exposures.

Under existing regulations, super funds must publish detailed portfolio holdings twice a year. But ASIC noted that disclosure of internally managed fixed-income and private debt positions can inadvertently reveal the value of individual transactions, because reporting is aggregated by counterparty.

Where a fund has only one deal with a borrower, the size of that loan becomes clear, potentially exposing commercially sensitive arrangements.

“The proposals are about promoting regulatory balance and addressing problems without compromising essential disclosure for consumers,” explained ASIC commissioner Simone Constant.

Australia’s private credit market is estimated to hold around A$200bn (£100bn) in assets under management, fuelled by the expanding scale of Australia’s retirement savings system, which collectively oversees roughly A$4.5tn. Funds have been pushing further into alternative credit as they seek diversification and higher yields.

The consultation follows an ASIC review of private credit surveillance and superannuation reporting.

The regulator’s latest findings show that allocations to alternative credit have grown “rapidly” over the past 18 months, though the review also flagged concerns around governance, transparency, fee structures, interest rates and the use of complex deal structuring.

Alongside the proposed changes to private debt disclosures, ASIC is also considering allowing stamp duty to be reported as a seven-year average rather than an annual figure in super fund and investment manager fee summaries.