UK pension funds increase private credit investments despite valuation concerns

Major UK pension insurers have moved more of their money into private credit. Legal & General, Standard Life, and Just Group now each hold more than 10% of their portfolios in these assets. Private credit means loans made to companies outside the normal banking system. These loans are hard to value because they are not traded publicly like shares or bonds. The ratings agency S&P has warned that pricing these assets accurately is difficult. This creates a problem when investors need to understand the true financial health of a pension fund. Despite this warning, the insurers have continued to increase their private credit holdings, seeking better returns than traditional investments offer.