Private credit remains one of the most attractive asset classes for income-seeking investors. However, competition among non-bank lenders has intensified. Margins have compressed, deal structures have loosened in parts of the market, and the temptation to chase growth at the expense of credit quality is real.

Ark’s position is clear: discipline beats speed.

We continue to see strong borrower demand in the mid-market property and development finance segment, with particularly solid momentum across Queensland, South Australia and Western Australia. These markets are benefiting from population growth, infrastructure activity, and a healthy project pipeline. But even in this environment, our approach remains selective. Lending appetite must align with risk appetite and that means saying no more often than yes.

Long-term performance is determined not by how fast you lend, but by how well you are positioned when the cycle shifts.

Investor sentiment in 2026 is being reshaped by one of the most significant regulatory moments the private credit sector has seen in years.

ASIC’s recent surveillance review highlighted material inconsistencies across the market, from valuation practices and conflict-management frameworks to fee transparency and liquidity oversight, making it clear that the sector must raise the bar. These findings have been confronting for some managers and clarifying for others. For Ark, they reinforce the foundations we have always built around: discipline, transparency and investor-first governance.

As a result, we are seeing a decisive flight to quality. Investors are gravitating toward managers who can demonstrate consistent credit processes, independent oversight, clear reporting and genuine alignment with investor outcomes.

At Ark, ASIC’s findings mirror where we have always positioned ourselves. But they also present an opportunity to not merely comply with higher expectations, but to lead. Strengthened valuation processes, enhanced conflicts-management structures and increased transparency are not regulatory burdens; they are the fundamentals of long-term, resilient private credit.

Investors recognise that distinction. Managers who demonstrate readiness for deeper regulatory scrutiny, clearer standards and stronger credit governance will be the ones who earn investor confidence through the next cycle.

• Exposure concentration – Are we over-exposed to certain sectors or borrowers?
• Liquidity alignment – Can we meet investor redemptions without compromising asset quality?
• Data integrity – Are our systems giving us accurate, timely information to act decisively?

The winners in the next phase will be those who entered it prepared with strong portfolios, sound capital structures and high investor confidence.

This is where the CFO lens matters most: protecting returns today while laying out the foundations for scalable growth tomorrow. For private credit managers, that means:

Maintaining conservative credit discipline

Strengthening operational systems for efficiency and insight

Building investor relationships grounded in trust, not just performance

When the next growth phase takes hold, and it will, disciplined managers will be ready to move decisively.

In private credit, success is rarely about timing the market rather it is about managing through it. As the industry evolves, the next growth story will belong to those who balance conviction with control.

At Ark Capital, that’s the balance we continue to protect.

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