The German fund industry association BVI is asking the Finance Ministry to consider the possibility to allow open-ended Spezialfonds vehicles to lend money when implementing the Alternative Investment Fund Managers Directive II (AIFMD II), said Peggy Steffen, head of risk at BVI, during the podcast Nachdenken hosted by the association.

Open-ended Spezialfonds are vehicles open to institutional investors that currently hold the largest share of assets (€2.15trn) managed by German funds, according to the latest figures published by BVI.

Pension schemes are the largest investors in open-ended Spezialfonds with €748bn, followed by insurance companies allocating €543bn in such vehicles, according to the figures. However now the closed-ended Spezialfonds are in principle the only “pure lending” vehicles, Steffen said.

The closed-ended Spezialfonds “are what you describe in English as loan originating fund”, Thomas Richter, BVI’s chief executive officer, explained.

The share of credit funds in Spezialfonds in Germany is relatively small – 1.4%, or €28bn – because the largest share of credit funds (60%) is domiciled in Luxemburg, the CEO said.

Luxemburg also allows to set up open-ended credit funds, Steffen said.

“In Berlin we have [received] positive signals from the Finance Ministry, [which is] ready to take up suggestions. We have quite a long wish list, which opens up opportunities [offered by] the directive both in public funds and in Spezialfonds”, she added.

The European Union has reviewed the AIFMD II to deepen the Capital Market Union. Member states have two years to transpose the rules into national law, meaning that the Directive will apply from April 2026.

The German Investment Code (Kapitalanlagegesetzbuch, KAGB) does not mention credit or loan funds (Darlehenfonds), or private debt, but only loan granting to a third party (Darlehensgewärung), Steffen explained.

The term private debt, intended as loan granting, or investing in loan-granting vehicles, was introduced in the German Act Implementing the UCITS V Directive (OGAW -V-Umsetzungsgesetz) that entered into force in 2016.

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