Private Credit insights requested
Dear fellow monkeys
While I am fairly new to the entire industry and happy to almost start with my summer internship, I am currently doing my thesis and stuck on the following:
My research is about the relationship of different types of lenders with their customers (borrowers) and the impact on renegotiation outcomes.
Literature generally divides lenders into the following categories: commercial banks, investment banks, private equity, asset management and other categories (HF, Insurance, Finance companies).
My hypothesis is that nonbank lenders, operating more on an incidental basis compared to relationship banking, are less willing to engage in renegotiations. I would expect that banks would be more willing to engage in renegotiations in order to win future businesses.
In my dataset is for instance:
Goldman Sachs & Co, Goldman Sachs Asset Management LP & Goldman Sachs Credit Partners
Would you suggest classifying via either the first or second method? And why?
Lender Class. Method 1 Class. Method 2
Goldman Sachs & Co Investment bank Investment bank
Goldman Sachs Asset Management LP Investment bank Asset Management
Goldman Sachs Credit Partners Investment bank Private Credit
The purpose of the classification is mainly to distinguish between the degree of relationship with the borrower.
If someone with experience in this field would be willing to share their personal experience or industry knowledge it would be of tremendous help to get in touch!
Many thanks fellow monkeys,
Best.
Class Method 2 is the correct one. For example, Goldman Sachs Asset Management is managing other people's money, so they aren't operating like a bank. They are not an investment bank.
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