Introduction

The Gulf Cooperation Council (GCC) has emerged as one of the world’s fastest-growing hubs for private capital. While public markets and sovereign wealth funds have long dominated the investment landscape, a quiet revolution is taking place: the rise of private capital markets and the growing adoption of structured finance vehicles to bridge professional and institutional investors to private placements. 

From family offices in Dubai to institutional allocators in Riyadh, investors are increasingly turning to private credit and bespoke structures such as Credit Linked Notes (CLNs) and Actively Managed Certificates (AMCs) to access differentiated yield, diversify portfolios, and manage risk.

In this article, we at Kingsbury & Partners, in collaboration with ISP Group, share our perspectives on how private capital markets in the GCC are evolving, why structured finance is gaining traction, and what this means for investors and issuers alike. At the heart of this transformation is our strategic partnership, where John Hubball, CIO of Kingsbury & Partners, teams up with Kristina Nikolendzic, Head of ISP Group’s Dubai office and Senior Executive Officer, to deliver innovative Credit Linked Notes tailored for the GCC region. 

ISP Group is a Swiss privately-owned investment boutique headquartered in Switzerland, with offices in Zurich, Geneva, Dubai, Hong Kong, and Israel. Its regulated entities specialize in Asset Solutions, Digital Assets, Investment Management, and Global Markets, serving an international client base.

What Are Private Capital Markets? 

Private capital markets encompass financial transactions that occur outside of traditional public markets. These include: 

  • Private Equity: Investments in unlisted companies. 
  • Private Credit: Non-bank lending, including direct lending, mezzanine finance, and distressed debt. 
  • Real Assets: Infrastructure, real estate, and commodities in privately negotiated deals. 
  • Venture Capital: Funding for start-ups and early-stage businesses. 

Unlike public markets, where securities are traded openly on exchanges, private capital markets rely on bilateral negotiation, institutional networks, and structured vehicles to connect investors with opportunities. 

For investors in the GCC, many of whom are family-owned businesses and high-net-worth individuals, private markets have become increasingly appealing due to control, flexibility, and superior yield compared to traditional bank deposits and bonds. 

The Rise of Private Capital Markets in the GCC 

Growth of Private Credit in the Region 

Private credit has been the standout growth area in recent years. Globally, the private credit market surpassed $1.7 trillion in assets under management in 2024 (Preqin), and the GCC is quickly catching up. 

In the UAE alone, demand for non-bank finance solutions has accelerated, particularly in sectors such as real estate, trade finance, and SME lending. Traditional banks remain constrained by capital adequacy rules, leaving space for private lenders to fill the gap. 

According to DIFC data, the number of asset managers licensed in Dubai grew by 35% between 2020 and 2023, with private credit strategies making up a significant portion of this expansion. 

Investor Appetite 

The GCC’s investor base is evolving: 

  • Sovereign Wealth Funds (SWFs): Allocating more to alternatives, including private credit. 
  • Family Offices: Seeking steady yield and asset-backed deals that preserve capital. 
  • Institutional Investors: Exploring structured finance for diversification. 
  • External Asset Managers: Seeking regional diversification. 

In Saudi Arabia, the Public Investment Fund (PIF) has allocated billions into alternatives, setting a precedent that trickles down to private allocators. In Dubai, family offices are building exposure to private credit for its combination of predictable cash flow and asset-backed security. 

What Is Structured Finance? 

Structured finance refers to customised financial instruments designed to meet specific investment or funding objectives, often involving the pooling, tranching, or securitisation of underlying assets. 

Unlike traditional loans or bonds, structured products are bespoke solutions—tailored for a particular investor base or funding need. Increasingly in the GCC, these are offered through private placements, giving issuers flexibility in how they raise capital while ensuring investors have access to institutional-grade opportunities. 

Structured finance can: 

  • Create access to otherwise illiquid strategies. 
  • Improve risk-return trade-offs. 
  • Provide institutional-grade reporting and custody. 
  • Syndicate smaller investors into institutional-level opportunities through private placement Credit Linked Notes and Actively Managed Certificates. 

Why Structured Finance Is Gaining Traction in the GCC 

Several factors are driving the growing adoption of structured finance across the UAE and wider GCC: 

  1. Complex Regulatory Environment: For international investors, navigating local legal and regulatory frameworks can be unfamiliar and time-consuming. Structured products—issued through Euroclear/Clearstream with established governance—provide clarity and comfort. 
  2. Lack of Clean Governance Structures: Many regional private investments have historically been executed through opaque SPVs or bilateral deals. Structured finance vehicles, by contrast, impose clear governance, reporting, and investor protections that align with international best practices. 
  3. High Cost Barrier to Entry for SMEs and Growth-Stage Businesses: Establishing a regulated fund or onshore structure to raise capital of USD 25 million or more is often prohibitively expensive and slow. CLNs and AMCs offer these businesses a faster, more cost-effective route to tap private capital while still delivering a bankable, professional product to investors. 

As a result, structured finance has become the bridge between global investors seeking transparency and regional issuers seeking efficient access to capital—a dynamic that explains its rapid rise in the GCC’s private capital markets. 

How Credit Linked Notes Are Opening Private Credit Markets in the GCC 

One of the most significant developments in the GCC has been the institutionalisation of private credit through Credit Linked Notes (CLNs). 

Historically, private credit in the region was limited to direct bilateral deals between investors and issuers. While often lucrative, these arrangements lacked scale, liquidity, and operational efficiency. CLNs are changing this dynamic by: 

  • Making private credit bankable: CLNs are issued as securities and can be custodied at Euroclear or Clearstream. 
  • Widening investor access: Family offices, private banks, and wealth managers can allocate via familiar ISIN-based securities. 
  • Scaling distribution: Issuers can raise larger tickets by syndicating investors across a single note. 
  • Enhancing transparency: Notes come with prospectuses, reporting frameworks, and credit monitoring. 

Recent UAE issuances have already packaged invoice financing platforms and real estate-backed lending into tradeable securities, enabling international capital to flow into GCC opportunities. We are also seeing meaningful traction from regional real estate developers, who view CLNs as a way to syndicate investors both locally and internationally, rather than relying on limited pools of domestic capital or slow-moving fund structures. 

At the same time, non-bank financial institutions (NBFIs)—from consumer lenders to SME finance providers—are increasingly turning to CLNs to diversify their funding lines. By accessing institutional and family office investors through a Euroclear-able structure, these firms are no longer reliant on a single bank or private equity sponsor. Instead, they can broaden their investor base, improve funding resilience, and unlock growth at scale. 

Taken together, these trends demonstrate how CLNs are becoming a foundational tool for capital formation in the GCC—bridging issuers with global investors through structures that deliver both efficiency and credibility. 

The Role of Paying Agents in Credit Linked Notes 

In the issuance and management of Credit Linked Notes, the paying agent plays a pivotal role in ensuring seamless operations and compliance. As the paying agent, ISP Group handles critical functions such as accepting payments from issuers, calculating interest and principal amounts, distributing funds to security holders, and servicing corporate actions throughout the note's lifecycle. This includes managing settlements via platforms like Euroclear and Clearstream, providing segregated account keeping, and facilitating trading in primary and secondary markets. 

The paying agent's involvement mitigates risks by structuring CLNs through Special Purpose Vehicles (SPVs), which isolate credit risks from the asset manager and enhance investor protection. Moreover, ISP Group's extensive network provides access to over 700 open counterparties, enabling efficient trading, settlement, and distribution of CLNs across global institutions. This vast connectivity reduces onboarding costs for clients and ensures best execution, making ISP an ideal partner for scaling private credit in the GCC. 

Case Study: CLNs vs. Fund Structures 

Flexibility vs. Friction 

When raising capital in the GCC, many issuers initially consider fund structures. While funds are established globally, they come with drawbacks: 

  • Costly: Significant upfront legal, licensing, and audit expenses. 
  • Time-Consuming: Launching a fund can take months—sometimes a year or more. 
  • Inflexible: Fixed mandates and lock-up periods often don’t suit SMEs or family offices. 

Credit Linked Notes, by comparison, offer: 

  • Customisation: Built around specific credit exposures or loan portfolios. 
  • Speed to Market: Issuance can be completed in weeks, not months. 
  • Outsourced Setup: Legal documentation, ISIN registration, Euroclear/Clearstream settlement, and reporting handled by external providers. 
  • Scalable Distribution: CLNs issued via private placement are easily distributed to professional investors across banks, platforms, and custodians. 

In short, CLNs are faster, more flexible, and more cost-effective, particularly for growth-stage businesses seeking to raise $25m or less efficiently. 

Partnership: Kingsbury & Partners x ISP Group 

Recognising the need for a turnkey, outsourced solution for structuring private credit in the GCC, Kingsbury & Partners has partnered with ISP Group—acting as the paying agent—alongside Fundamentals (note administrator) and Abalone Capital (DFSA-regulated note manager), to deliver institutional-grade issuance platforms based in Luxembourg. 

Through this partnership, issuers, corporates, and asset managers gain access to: 

  • Customisable Structures: CLNs tailored to specific strategies and investor requirements. 
  • Speed to Market: Notes can be structured and listed in weeks, enabling issuers to capture opportunities without delays. 
  • Institutional Governance: Outsourced administration, reporting, and risk oversight aligned with global standards. 
  • Bankable Access: Securities with Swiss ISINs, Euroclear/Clearstream settlement, and global custodial acceptance. 

Kingsbury & Partners provides a comprehensive turnkey platform to issue private credit via Credit Linked Notes, handling origination, structuring, and distribution while leveraging ISP Group's operational expertise. This collaboration empowers GCC-based entities to efficiently tap into global capital markets without the complexities of traditional setups. 

John Hubball, CIO, Kingsbury & Partners: 

“Our mission has always been to make private credit more accessible, transparent, and investable. By working with ISP Group and our regulated partners, we can offer issuers and asset managers in the GCC a clear pathway to raise institutional-grade capital without the friction of traditional fund structures. It’s about creating efficiency without compromising on governance.” 

Kristina Nikolendzic, Head ISP Group’s Dubai office and Senior Executive Officer: 

“What excites me most is how the GCC is becoming a true hub for structured finance innovation. Investors are asking for clean, bankable products, and issuers want cost-effective ways to access global capital. Through our role as paying agent, alongside Kingsbury & Partners’ structuring expertise, we’re building the infrastructure that connects those two sides seamlessly.” 

Bridging the Gap 

The GCC is no longer just a destination for capital: it is becoming a generator of institutional-grade opportunities in private credit and structured finance. Investors across the region, from sovereign wealth funds to family offices, are demanding transparency, bankability, and yield. At the same time, corporates, developers, and non-bank financial institutions are seeking efficient, flexible ways to access capital without the burden of costly, rigid fund structures. 

This is where Credit Linked Notes are reshaping the landscape. They bridge global capital with regional strategies, offering both sides of the market the speed, governance, and scalability they need. 

Through the partnership between Kingsbury & Partners and ISP Group, supported by Fundamentals and Abalone Capital, issuers gain a turnkey platform to raise capital, while investors gain confidence that each structure meets international standards of custody, reporting, and risk oversight. Kingsbury & Partners brings origination, structuring, and distribution expertise; ISP Group delivers operational precision as payment and calculation agent, with access to a vast network of over 700 counterparties to facilitate seamless execution. Together, we are building the infrastructure for private credit in the GCC.