Zurich is going through one of the hottest weeks of the summer, but Reji Vettasseri shows no sign of it. Decalia’s Lead Portfolio Manager for Private Credit Strategies has travelled from the investment boutique’s Geneva headquarters to its offices on Rennweg, for a day of meetings with institutional investors. He greets his visitor with a broad smile and gets straight into a subject that has kept the financial press busy for months: is private credit the next big accident waiting to happen?
«Everyone has read the articles,» he says, relaxed. «There are elements of them that are a little bit overblown, but there’s also a kernel of truth.» Default rates in parts of the direct lending market are «a little bit higher than they should be at this point in the cycle – we’re not at financial-crisis, everything’s-blowing-up levels, but probably higher than normal.» For Vettasseri, that is not a reason to stay away. «That creates opportunities for people, who’ve been playing in the spaces that didn’t get too frothy, to come into those spaces that did and provide solutions while others are in retreat.»
From Bain to Goldman to Morgan Stanley
Vettasseri speaks with the calm of someone who has seen several market cycles from the inside. After studying law at Cambridge and taking an MBA at Harvard, he advised private equity firms at Bain, worked in investment banking at Goldman Sachs, and then built co-investment and secondaries portfolios at Morgan Stanley’s Alternative Investment Partners in London. There, shortly after the financial crisis, he watched a new asset class emerge. «The banks were retreating, and it created a big opportunity to fill a white space,» he recalls.
