The LMA is pleased to share its end of year Fund Finance Insights paper. The Insights series is intended to enhance understanding of this growing asset class. 

This latest paper explores the evolution of liquidity solutions in the market.  Whilst subscription facilities remain the cornerstone, financing tools increasingly sit alongside broader liquidity solutions such as continuation vehicles (CVs) and collateralised fund obligations (CFOs).  These innovations create opportunity but also complexity.

This latest Insights paper draws on perspectives from leading market participants to explore:

• The expanding liquidity toolkit
• LP sentiment and navigating complexity
• Transparency and alignment – the cornerstone of trust 
• Voices from the market – wish list and predictions for 2026 
• Final reflections and a call for collaboration.

On 21 November 2025, we submitted a high-level response to the FCA’s consultation on progressing fund tokenisation.

We believe tokenisation presents a significant opportunity for both funds and loan markets.

To utilise these benefits, we have urged for continued dialogue and collaboration between regulators and industry participants to ensure regulatory frameworks keep pace with technological innovation.

Institutional investors have become a valued source of additional capital and catalyst for innovation in the fund finance market. However, their participation as lenders impact how transactions are structured and documented.

In our latest insights paper, Shelley Morrison (Head of Fund Finance at Aberdeen) and Kam Hessling (Managing Director at the LMA) explore:

• The participation of institutional lenders in fund finance
• Practical structuring considerations, including operations, loan structure and funding timescales
• Investment entry points and diligence requirements
• The role of ratings
• Withholding tax and gross- up obligations
• Transferability provisions
• Future outlook

On 17 October 2025, we responded to the House of Lords Financial Services Regulation Committee’s inquiry on the growth of private markets in the UK.

Our response outlines how private credit has become a vital source of long-term financing for the real economy, complementing and, in some cases, substituting traditional bank lending. It details the increasing interconnections between banks and private credit funds - such as co-investment in leveraged loans, fund finance, and synthetic risk transfer - and discusses the implications for financial stability and access to credit. We also emphasise the importance of maintaining an internationally competitive and proportionate regulatory regime, ensuring that the benefits of private credit growth are recognised while safeguarding the resilience of the UK’s financial sector.