‘Bored and tired’: Cbus details private credit struggle

Speaking at the Citi Investment Conference Australia in Sydney, Anne Moal, head of direct debt and illiquid credit at Cbus, outlined the superannuation fund's cautious stance on private credit. Moal, who joined Cbus in 2020 from Perpetual, where she was head of corporate high yield, said she is struggling to identify attractive opportunities in the asset class, a problem she linked to elevated interest rates and challenged sectors. Cbus's MySuper Growth option currently carries a 6.5 per cent allocation to global credit, and the fund is underweight credit overall.

Moal described the current environment in blunt terms, saying she was "so bored and tired" and that "there are no obvious pockets of value in private credit unfortunately." The fund continues to look broadly across opportunities but is waiting for better entry points rather than deploying capital into weaker deals.

Drawing on the fund's position as a construction-focused super fund, Moal said the building sector has been under strain, with many developers deterred from new residential projects. She noted that fixed-cost building contracts leave construction firms absorbing significant risk. Cbus still values construction financing, which she described as important to its member base, but said it requires thorough due diligence, and that it seeks Tier 1 or Tier 2 developers with strong track records and deep balance sheets able to absorb unforeseen costs, given the fund's size.

Moal also addressed structural concerns, stating Cbus will not invest alongside retail capital because institutional and retail investors have different liquidity needs. She noted this has been a problem for private credit providers as funds traditionally reserved for institutions have opened to retail investors, sometimes without accounting for those differences. Because super fund members can switch options at any time, liquidity management is a particular concern. When appointing external credit managers, Cbus prefers a fund-of-funds structure tailored to its requirements, so it can control the vehicle and avoid exposure to other investors' liquidity demands, Moal said.