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. 

A big thank you to Slaughter and May who were able to work with us in putting this document together and to all the members who contributed.

On 21 October 2025, ESMA released their final report on the draft regulatory technical standards (RTS) for open-ended loan-originating alternative investment funds (OE LO AIFs). 

The draft RTS determine the requirements with which LO AIFs must comply to maintain an open-ended structure. Those requirements include a sound liquidity management system, the availability of liquid assets and stress testing, as well as an appropriate redemption policy having regard to the liquidity profile of OE LO AIFs.

The LMA responded to ESMA's consultation on the draft RTS in March this year and we are pleased to see that a number of our suggestions have been adopted, including:

• the removal of the requirement for AIFMs to determine a target appropriate amount of liquid assets;

• reduced liquidity stress testing frequency; and

• the exclusion of ESG and innovation related aspects from the RTS.

On 17 September 2025, the LMA published its recommendations on further improving the EU securitisation framework following the European Commission's recent proposals (SR Proposals). 

Securitisation has an enormous potential to boost EU funding by attracting capital globally. But without a clear, proportionate regulatory framework, investor confidence - and thus Europe’s competitiveness - remains at risk.

In our position paper accompanied by detailed technical annex, we put forward key recommendations across three areas to help advocate for a more proportionate and ambitious regulatory framework - (i) building market confidence; (ii) removing investor barriers; and (iii) ensuring proportionate capital and liquidity requirements.