Nov 5, 2026 · 50 min
Private credit finds opportunity in volatility
Invesco’s Private Credit CIO Eyes ‘Equity-Like’ Returns in Loans
The episode examines whether wider spreads can deliver equity-like loan returns without sacrificing underwriting discipline as defaults, regulation, and market access evolve.
- 1Wider spreads and volatility are creating selective opportunities in secondary loans and private credit.
- 2Underwriting discipline, borrower resilience, and recovery prospects matter more than deployment pressure or headline yields.
- 3CLOs, tokenization, and retail products could broaden access while introducing new questions about liquidity, valuation, and suitability.
Don't miss
Scott Baskind distinguishes liquidity-driven credit stress from fundamental deterioration, then links that distinction to recoveries and contrarian deployment.
The brief
Invesco private-credit chief investment officer Scott Baskind weighs public and private markets, arguing that investors should assess liquid and illiquid credit together rather than treat them as separate worlds.
The central risk is not simply rising defaults: it is whether weaker borrowers can absorb higher funding costs, preserve earnings, and generate recoveries when liquidity stress becomes fundamental deterioration.
Baskind makes underwriting discipline the dividing line between attractive spreads and hidden losses, warning that manager competition and deployment pressure can weaken lender protections.
AI-related lending adds a new layer of selection, from hyperscalers and data centers to investment-grade and non-investment-grade borrowers whose capital needs and competitive positions differ sharply.
CLOs remain a foundation of leveraged lending, while volatility is opening chances to buy quality secondary loans at wider spreads and below-par prices.
Baskind’s cautiously optimistic conclusion is also a warning: visible risks can be priced, but unknown risks demand preparation, regional flexibility, and skepticism toward market headlines.
What was said on this episode
15 statements · 10 positive · 2 negative · 2 mixed · 1 neutral
- Scott Baskindon Private credit issuersPositive28:17
Issuer quality remains stable, supporting optimism about private credit opportunities
“the quality of issuers remains quite stable in comparison to historical. historical period. So we remain quite optimistic about that.”
Listen at 28:17
- Scott Baskindon Private-market financing opportunitiesPositive29:04
Capital continues flowing into strong private-market financing opportunities
“significant capital continues to be raised for strategies and deployed into very strong. financing opportunities.”
Listen at 29:04
- Scott Baskindon Private marketsPositive29:14
Private markets provide diversification and strong income orientation versus public markets
“investors continue to enjoy the outcomes and benefits of investing in the private markets in general, which are really adding great diversity versus the public market, strong income orientation for investors.”
Listen at 29:14
Invesco favors consumer non-discretionary and underweights technology in private credit
“we heavily favor consumer non-discretionary. in sectors in general, and we look to underweight some of the more innovative sectors such as technology.”
Listen at 30:03
Invesco private credit aims to preserve capital and receive repayment at par
“our goals are to preserve capital, to get our capital paid back at par.”
Listen at 30:52
Invesco generally lends at par and seeks continuous investment income
“We generally lend at par. We want our capital to get paid at par and have continuity of that income stream.”
Listen at 30:59
Invesco private credit emphasizes downside protection over equity upside
“So everything's about downside protections, if you will.”
Listen at 31:11
Technology is benefiting many Invesco private-credit borrowers
“Technology is one of the most supportive, innovative, areas of the market, and it's proving to be incredibly beneficial to many of our borrowers”
Listen at 31:49
- Scott Baskindon Companies and technologyNeutral32:08
Every company should be viewed as a technology company
“every company is a technology company”
Listen at 32:08
- Scott Baskindon Corporate liquidityPositive32:47
Strong liquidity is essential to companies’ future performance
“having strong liquidity base is... as essential in terms of how companies are going to be performing in the future.”
Listen at 32:47
- Scott Baskindon Corporate R&D spendingPositive32:55
Continued R&D spending is critical for companies
“The ability to continue to spend on R&D, absolutely critical.”
Listen at 32:55
- Scott Baskindon AI-enabled technology companiesPositive33:11
Invesco supports technology companies using AI to improve operations and outputs
“areas within technology that we've been quite... quite supportive of would be ones that are using AI to improve their companies and improve their outputs on behalf of their customers on a long-term basis.”
Listen at 33:11
Invesco’s private-credit franchise does not invest in investment-grade assets
“within our franchise, we don't invest in investment grade.”
Listen at 33:51
- Scott Baskindon Non-investment-grade AI financing issuanceNegative34:16
Non-investment-grade issuance directly tied to AI buildout remains limited
“within a non-investment-grade space, we've seen very little issuance that is sort of directly tied to the AI build-out”
Listen at 34:16
- Scott Baskindon Invesco AI-sector deploymentMixed34:34
Invesco can deploy conservatively toward the fast-changing AI sector
“we can be quite conservative in terms of how we deploy to this ever-changing, fast-paced sector.”
Listen at 34:34
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
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