A growing market for private debt
The private debt market (direct lending, loan funds) continues its strong expansion across Europe. As banks gradually withdraw from certain segments of corporate financing, asset managers are stepping in as key players in financing the real economy.
This growth now benefits from a structured regulatory framework that has just come into force.
AIFMD II: transposed in april 2026
The AIFMD II Directive (revision of the Alternative Investment Fund Managers Directive) was transposed in April 2026, marking a turning point for the debt fund industry.
Key changes for debt funds
The directive introduces a harmonized European framework for loan-originating funds, including:
- Common rules on loan origination activities by AIFs
- Enhanced risk management and liquidity requirements
- A streamlined European passport for loan funds
- Specific leverage limits for loan-originating funds (175% for open-ended funds, 300% for closed-ended funds)
- Diversification requirements on exposures
- Authorized originate-to-distribute structures only under specific conditions.
A Turning Point for the Debt Funds Industry
Until transposition, each Member State applied its own rules on loan funds. AIFMD II harmonizes this fragmentation, enabling:
- Easier cross-border distribution
- Greater legal certainty for the activity
- Stronger operational requirements
- Mandatory review of existing processes
France: AMF Clarifies Its Doctrine 🇫🇷
In line with a new clarification, the AMF has revised its Position-Recommendation DOC-2012-19, the reference document on the business of portfolio management companies.
The key point: loan mandates as an ancillary activity
The AMF clarifies the conditions under which a portfolio management company may be entrusted, on an ancillary basis, with a mandate to:
- Originate loans in the name and on behalf of a lender, and/or
- Manage loans originated by that lender
Why It Matters for Debt Funds and Loan Managers
This clarification supports more flexible business models for French management companies:
- They can now act as service providers to third-party lenders (insurers, pension funds, family offices…)
- They can structure their offering around loan management mandates without necessarily holding the loans themselves
- It broadens their service range beyond fund management alone
What this means for market participants
For existing management companies
Opportunity to diversify their business model by offering loan management services to institutional lenders, without necessarily creating new AIF vehicles.
For debt fund managers
Compliance with AIFMD II is now effective (risk, liquidity, leverage, diversification policies). Managers must consolidate their framework and leverage the harmonized passport for cross-border distribution.
For institutional lenders (insurers, mutuals, pension funds…)
A clarified option: it is possible, subject to applicable conditions, to entrust a French management company with a loan origination and/or management mandate without necessarily having to set up a dedicated AIF, enabling more flexible private debt strategies
AMF clarification on loan origination mandates
The AMF clarifies the conditions under which a portfolio management company may be entrusted, as an ancillary activity, with a mandate consisting of granting loans on behalf of and for the account of a lender and/or managing loans granted by that lender.
Outside the scope of fund management, an investment management company may be entrusted with a mandate consisting of granting loans in the name and on behalf of a lender and/or managing loans granted by that lender.
This activity must be carried out as an extension of its core business. The investment management company must also ensure that such activity complies with the applicable regulations in France or abroad, in particular those relating to banking and payment intermediation services and credit management, and, with regard to the lender, those relating to the banking monopoly.
How NeoXam helps debt fund managers navigate AIFMD II
NeoXam supports debt fund managers with integrated solutions designed to help firms industrialize private debt operations while meeting evolving European regulatory requirements.
GP supports many typologies of loans and private debt, such as syndicated loans, profit participating loans, as well as less standard loans. GP properly records the funded and the unfunded, which allows for close monitoring of the remaining commitment. GP supports cash and in kind interest calculation and payment or capitalization, for both the funded and the unfunded legs.
Reconciliation is an essential component to managing a Loan Portfolio. Due to the complexity of loans, the lack of industry identifiers, the lack of industry infrastructure to standardize the payment and the requirement to decipher if a payment was the regular interest payment, a principal pre-payments or incomplete interest payment. This is where a toll like NeoXam Aro Reconciliation platform is used at its best and where we have years of experience untangling all the (payment) wires.
