AIA Hong Kong eyes private credit 'outlier' under new capital rules

AIA Hong Kong views private credit investment as an appealing investment under the city’s new risk-based capital (RBC) regime for insurers, despite the onset of a rate-cut cycle, according to the insurer’s investment chief. Under Hong Kong’s new regulatory framework, private credit is assigned a 15% risk charge, while it could potentially generate returns of around 10%. This is significantly lower than the 50% risk charge applied to private equity. “That (private credit) is an o…