NEAM Insights

Private credit’s rapid expansion has prompted echoes of the subprime lending boom, raising the question of whether another financial stress event could follow. While the comparison is useful given the similarities in borrower weakness, leverage, and limited transparency, it should not be overstated. Private credit appears vulnerable to credit losses and repricing, but lacks the degree of interconnectedness, short-term funding dependence, and transmission into the banking system that made subprime mortgages systemically destructive. In the end, private credit is a market that may prove painful for some investors and borrowers, but it is less likely to trigger a broad financial shock. Read More

In today’s market environment, alternatives and private credit dominate the conversation. These products are marketed as innovative, differentiated, and attractive, while core fixed income is often dismissed as boring, commoditized, or merely a portfolio requirement. For some market participants, core bonds have become an afterthought, something to hold because investment policy requires it. That framing is misguided. Core fixed income does not have to be plain vanilla. When managed actively, thoughtfully, and with discipline, core fixed income can be a durable source of compounded alpha and true value creation over time. Read More

Strong Returns for Investment Grade Bonds in 2025 Investment-grade bonds staged a comeback in 2025, overcoming a year marked by significant economic policy uncertainty. The ICE BofA Aggregate Bond Index surged to a total return of 7.1%, a substantial improvement from 1.5% in 2024, with gains split equally between price appreciation and income. Interest rates dropped considerably across the curve: short- and intermediate-term maturities fell by about 70 basis points, the 10-year yield declined 40 basis points, while the 30-year yield remained stable. Read More

In the Spring of 2025 Germany announced its intention to increase spending in a manner that was unimaginable at the start of this year, not to speak of a decade ago. The scale of Germany’s fiscal shift is enormous with potential implications for economic growth, inflation, and geopolitics. Exhibit 1 illustrates that expenditure in the coming years (% of GDP) is forecast to rival the amount spent on German reunification. Read More

As sustainability factors become embedded in insurers’ investment strategies, and non-financial disclosures become more standardised globally, the defence sector presents both challenge and opportunity within fixed income strategies. Long viewed as a standard exclusion, institutional investors are reassessing their stance on the sector and considering the potential positive impact that may be achieved through selective investment in the space, supported by regulatory guidance. Read More

Higher education in the U.S. is in a crisis of sorts. The sector is contending with a litany of pressures that are forcing institutions to evolve in an increasingly bifurcated marketplace. This directly impacts insurer portfolios, as higher education represents approximately 9% of U.S. insurance company municipal bond holdings. Despite the recent Federal policy headwinds, the most competitive institutions continue to demonstrate resilience while others face mounting financial and enrollment pressures. Read More

Tariff Regime Change In 2025, the U.S. unleashed the most sweeping tariff regime since Smoot-Hawley: minimum 10% reciprocal duties on nearly all imports, layered on metals tariffs, and revived Section 301 penalties on targeted goods under national security authority. China faced combined rates as high as 145% before a fragile truce reduced many categories down toward 30%, but new moves (such as threats of 100% tariffs to Chinese port fees and stricter rare-earth export controls) show that volatility is returning. Removal of the $800 de minimis threshold for low-value imports has dragged e-commerce and everyday goods into the tariff net, extending the policy’s reach to every U.S. household. With average U.S. rates near 18% (see Exhibit 1), tariffs have become a structural feature of U.S. economic policy. Read More

Introduction Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation) are the cornerstones of the U.S. housing finance system. As Government-Sponsored Enterprises (GSEs), their primary function is to ensure liquidity, stability, and affordability in the secondary mortgage market by purchasing mortgages from lenders, pooling them, and issuing mortgage-backed securities (MBS) with a repayment guarantee. This process frees up lenders’ capital and enables them to extend more loans to homebuyers, contributing significantly to housing affordability and availability. Together, the GSEs guarantee $6.67 trillion of Single-Family mortgages, equivalent to ~52% of outstanding U.S. mortgage debt.1,2,3 Read More

introduction On 1 November 2024, the UK implemented Securitisation Regulation 2024, which is reshaping how institutional investors — such as Lloyd’s syndicates — assess the structured securities markets. This departure from the EU regulations has modernised the regulatory approach, which aligns better with practices in the US market, and streamlines compliance for UK-based institutional investors. This publication discusses the investment opportunities for Lloyd’s syndicates and other London Market entities. Read More

Government Debt in the 21st Century One of the defining issues of our time is the debt sustainability of sovereign nations. For much of this century, governments around the developed world have lacked the political will or leadership to pursue fiscal austerity measures that would address large fiscal deficits and would put sovereign debt levels on a sustainable path. Politicians have made the determination that it is better to defer addressing the issue, get elected or re-elected, and leave the difficult decisions that may involve sacrifice for a later date or for someone else. The result of this procrastination approach has been ever rising levels of debt on both an absolute basis and relative to the size of the economy. Read More