Resilience Beneath the Surface: Structured Credit Navigates a Volatile 2026

Executive Summary

• Macro resilience despite shocks: Markets have absorbed geopolitical and energy shocks, with oil risks repriced toward a “managed disruption” scenario.
• Private credit stability stands out: Private credit offers low volatility and limited mark-to-market exposure, supporting portfolio stability.
• Constructive securitisation outlook: Positive sentiment points to higher issuance,improved liquidity, and tighter pricing into 2026–27.
• Strong asset performance: Consumer, SME, trade finance, and leasing assets remain resilient, supported by stable demand and improving trade.
• Rise of alternative originators: Tech-driven lenders are gaining traction, with stronger governance and underwriting reducing originator risk.
• Inflation impact manageable: Energy-driven inflation pressures persist, but stabilising expectations support performance, with continued borrower monitoring key.
• Discipline remains critical: Robust due diligence, transparency, and surveillance are essential to manage structuring and asset-level risks.
• Strategic portfolio role reinforced: Private credit and securitisations offer stable income and low correlation, strengthening their role as core allocations.

Geopolitical shocks and inflation pressures defined 1H2026, but markets proved more adaptable than expected. Beneath the volatility, private credit and securitisation are emerging as resilient pillars shaping investor optimism.

The first half of 2026 has tested markets with a familiar but potent combination:
geopolitical shocks, energy-driven inflation pressures, and a shifting political landscape across major economies. Yet, beneath the surface volatility, private credit and securitisation markets are showing a quiet resilience, one that is increasingly shaping investor expectations for the remainder of the year.

At the Global ABS conference in Barcelona, a consistent message emerged from market participants and thought leaders including Mohamed ElErian: while macro risks remain real, they are being absorbed more efficiently than in past cycles. Nowhere is this more evident than in energy markets. Initial fears of a supply disruption of up to 10 million barrels per day linked to tensions around the Strait of Hormuz drove a sharp repricing in oil and risk assets. However, as diplomatic channels reopened, markets began to scale back worst-case assumptions, echoing the trajectory seen during the early stages of the Ukraine conflict. What followed then—and appears to be unfolding again, is an adjustment toward a “managed disruption” environment, where businesses and supply chains continue to operate despite ongoing geopolitical stress.

This ability to adapt is mirrored in credit markets. Private credit, in particular, has reinforced its position as a stabilising force. Unlike public fixed income markets, where mark-to-market volatility can amplify macro shocks, private credit structures offer smoother valuation dynamics. Investors benefit from lower observed volatility while maintaining exposure to underlying economic activity, an increasingly valuable characteristic in a world of persistent uncertainty.

The divergence between corporate and sovereign risk has also become more pronounced. Corporates, supported by operational flexibility and pricing power, continue to outperform sovereigns, which face growing political uncertainty and fiscal pressures. This trend reflects an important shift: creditworthiness is increasingly driven by micro-level execution rather than macro-level stability. For structured finance investors, this reinforces the importance of granular asset selection and originator quality.

Inflation, meanwhile, remains a nuanced challenge. The current energy-driven price shock is feeding through to households and businesses, sustaining elevated headline levels. However, medium-term inflation expectations are stabilising, suggesting that central bank policy retains credibility. For securitised products, this creates a dual
dynamic. On one hand, higher nominal incomes can support collateral performance; on the other, affordability pressures, particularly among lower-income borrowers, require careful monitoring. The performance of underlying assets such as consumer loans, autofinance and SME lending will increasingly depend on how these opposing forces evolve.
Despite these complexities, sentiment at Global ABS was notably constructive. Across nearly 50 meetings with investors, originators and lenders, discussions were firmly focused on new transactions and pipeline development. This forward-looking stance reflects a broad expectation that liquidity conditions will improve and issuance will accelerate into 2026 and early 2027.

A new wave of technology-enabled lenders is filling Europe’s funding gap, supported by more efficient securitisation markets. But in a landscape of growing complexity, transparency, structure and discipline remain the cornerstone of investor confidence.

Particularly strong interest was observed in emerging, technology-driven originators. These platforms, often scaling portfolios from €20m to €50m, are addressing persistent funding gaps in European lending, especially in SMEs, trade finance and consumer credit. Importantly, their maturation is evident not only in financial performance but also in governance: experienced hires from traditional financial institutions are strengthening underwriting standards, risk management and operational execution. This evolution is helping to mitigate historical concerns around originator risk.

For mid-sized transactions in the €100–300m range, securitisation continues to offer compelling funding advantages. Market participants increasingly recognise the structural benefits of scaling portfolios into capital markets instruments, including a progressive reduction in funding costs, often by as much as 200 basis points, as transactions transition from private to listed formats. This dynamic is reinforcing securitisation’s role as a key enabler of balance sheet growth.

However, if the opportunity set is expanding, so too is the need for discipline. Discussions with legal and structuring partners highlighted the growing importance of robust due diligence and surveillance frameworks. Issues such as asset ringfencing, jurisdiction-specific registration requirements, and the prevention of double-pledging are no longer technical nuances, they are central to investor protection. Recent market cases have underscored the risks of insufficient oversight, making transparency and governance critical differentiators.

For investors such as Aluna Partners, this environment calls for a measured approach: combining optimism on market growth with rigorous scrutiny of underlying assets and structures. Enhancing OTC transactions with best practices from public securitisation markets, particularly in reporting, auditing and servicing standards, will be essential to maintaining investor confidence.

As macro risks are absorbed, structured finance is proving its strength beneath the surface. Stable income, low volatility, and diversification are making private credit and securitisation more relevant than ever.

Looking ahead, the outlook for European structured finance remains constructive. Market participants broadly expect volatility to moderate in the second half of 2026, with inflation gradually coming under control, albeit potentially requiring further monetary tightening. At the same time, lending activity continues to expand. Households have demonstrated resilience despite inflation pressures, while SMEs and corporates are increasing their demand for financing as economic growth stabilises and trade normalises toward pre-pandemic levels.

Leasing, in particular, is expected to benefit from renewed capital expenditure cycles, while newer asset classes such as insurance financing and short-term real estate lending are beginning to gain traction. Even so, core sectors, consumer credit, working capital, trade finance and leasing—remain at the heart of investor interest.

The message from Barcelona is clear: while macroeconomic uncertainty has not disappeared, it is increasingly being priced, managed and, in many cases, absorbed by market participants. In this context, private credit and securitisation are not merely weathering the storm, they are becoming structurally more relevant within investor portfolios. Their ability to generate stable, short-term income streams, combined with limited mark-to-market volatility, positions them as compelling tools in an environment shaped by political and inflation shocks. Crucially, their relatively low correlation to public market swings enhances their diversification value, particularly as traditional asset classes remain sensitive to macro headlines. For investors, this reinforces the case for allocating to strategies that combine resilience with disciplined underwriting, ensuring that performance is driven not only by yield, but by the strength and transparency of the underlying assets.