Welcome back to the Alt Goes Mainstream podcast.
Today’s episode was filmed live at an event during a Brookfield Oaktree Wealth Solutions RIA Council meeting in New York.
Armen Panossian, the Co-CEO and Head of Performing Credit at Oaktree, and I sat down for a conversation in a Brookfield-owned building with a group of RIAs in the audience.
Armen, who joined Oaktree in 2007, has been an integral part of scaling Oaktree to over $209B in AUM. Oaktree, a storied firm, particularly in distressed credit, was recently fully acquired by Brookfield, the $1T AUM alternative asset manager.
Armen has a wealth of experience across different areas of credit. He is the Head of Performing Credit, where his responsibilities include oversight of the firm’s liquid and private credit strategies and as a portfolio manager within the Global Private Debt and Global Credit strategies. He also led the development of Oaktree’s CLO business.
Armen and I had a fascinating and thought-provoking conversation. We covered:
The evolution of Oaktree’s business.
How the acquisition by Brookfield has helped scale Oaktree’s business.
Why private credit is more than direct lending.
The nuances of asset-based finance.
The current state of the credit markets.
How Oaktree has approached distressed credit investing.
What Armen’s memo would be if he were to write a memo like his colleague Howard Marks.
And, why his memo might be titled “this is not your grandma’s private credit” or “don’t reach for risk to deliver the right return.”
Thanks Armen and the Brookfield Oaktree Wealth Solutions team for a fantastic night and Armen for sharing your wisdom and expertise with us.
A word from AGM podcast sponsor, Ultimus Fund Solutions
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We thank Ultimus for their support of alts going mainstream.
Show Notes
00:00 Message from our Sponsor, Ultimus
01:20 Welcome to the Alt Goes Mainstream Podcast
02:01 Live Event at Brookfield Oaktree Wealth Solutions RIA Council Meeting
02:08 Guest Introduction: Armen Panossian
04:07 Armen’s Background and Career Path
04:31 Early Career and Education
08:32 Joining Oaktree
09:03 Oaktree’s Early Days and Growth
09:28 Oaktree’s Investment Philosophy and Culture
12:57 Balancing the Pessimism of a Credit Investor and Business Building
13:25 Business Building and Strategy
15:50 Private Credit Market Insights
16:09 Scale and Strategy in Private Credit
16:48 Core and Alpha in Private Credit
17:26 Oaktree’s Approach to Direct Lending
21:25 Public vs. Private Credit Markets
23:09 Technicals and Fundamentals in Credit Markets
25:58 Valuation and Risk Management
26:51 Public Markets as Indicators
27:03 Consumer Impact on Private Credit
27:27 Market Psychology and Risk
29:04 Opportunities in Life Sciences Investing
29:48 Private Market Solutions for Struggling Industries
29:58 Judging Business Winners and Investment Opportunities
30:03 Public Sentiment and Private Investment
30:18 Private Credit Headlines and Challenges
30:35 Perceived vs. Actual Risks in Private Credit
30:59 Credit Market Technicals: Private vs. Public
31:41 Fraud Vigilance in Credit Markets
32:08 Oaktree’s Approach to Opportunistic Credit
34:05 Rescue Lending and Market Opportunities
34:38 Sector-Specific Lending: Life Sciences and Asset-Backed Finance
35:27 Asset-Backed Finance Market Dynamics
36:02 Oaktree’s History in Asset-Backed Finance
37:20 Banking Regulations and Lending Practices
38:47 Investment Opportunities in Unrated Asset-Backed Finance
42:39 Navigating the Private Credit Ecosystem
43:07 Oaktree’s Growth and Brookfield Partnership
45:14 Wealth Channel Investment Strategies
46:42 Brookfield and Oaktree’s Unique DNA
48:56 Concerns and Opportunities in Private Credit
54:26 Howard’s Memos and Investment Philosophy
58:03 Conclusion and Final Thoughts
Editing and post-production work for this episode was provided by The Podcast Consultant.
