The Ledger

Europe’s 2025 CMBS cohort offers a clear window on private valuations. Using disclosures across €6.9 billion of issuance, we show how appraised marks diverge from rating-agency values, with most deals in a 23% to 34% haircut band and a 29.6% median. The piece explains why this gap emerges, where it may persist in private markets with thin price discovery, and how investors should treat reported cushions and re-underwrite cash flows.

Life insurers have tilted away from Treasuries into structured and private credit, propelled by private equity ownership and NAIC treatment. Those flows are repricing markets, consistent with inelastic markets research that small, persistent allocations move prices. Record CLO issuance shows the shift; First Brands’ bankruptcy flags underwriting risk. The next test arrives as rules tighten in 2026.

PE-linked insurers now run a four-cylinder capacity engine: asset-intensive reinsurance lowers required capital; tax positioning lifts retained earnings; evolving solvency rules reshape charges on private assets; and short-horizon balance sheet funding via funding agreements and FHLB advances converts claims-paying strength into deployable cash. Together these steps explain the post-2019 surge in insurer deployable capital.