Bloomberg Professional Services
As private markets evolve from a niche alternative to a systemic pillar of the Australian economy, is your firm prepared for 2026?
What are the opportunities?
Over the past decade, Australia’s capital markets have shifted materially. Private markets, while still relatively small compared to Australia’s AUD 3.3 trillion listed equity markets, are growing rapidly, as they are in other jurisdictions. By one estimate, the private credit sector has grown 500% over the past 10 years to more than AUD 200 billion: private markets are moving from “alternative” to being a core pillar of Australia’s capital formation.
A key driver of this growth has been the superannuation sector, whose assets under management now total AUD 4.3 trillion. Some of the largest funds hold over 20% of investments in unlisted assets, considered attractive for their stable cash flows, diversification benefits and perceived illiquidity premium.
This growth has been accompanied by structural changes in public markets. Over the past decade, the number of listed companies on the Australian Securities Exchange (ASX) has declined, while the value of equity raised in initial public offerings dropped by more than 80%. Market capitalization is concentrated in a limited number of stocks.
As the Australian Securities and Investments Commission (ASIC) has pointed out, public and private markets are converging into a single ecosystem, and as private credit becomes increasingly important, expectations on transparency, valuation integrity and governance are increasing.
What do the regulators say?
ASIC has engaged with the financial services industry to frame the future of Australia’s capital markets, culminating in a roadmap published on November 5. Read as a 2026 agenda, it signals that scale in private markets must be demonstrably resilient, well governed and quantifiable.
The regulator has emphasised that, when done well, private markets provide an important complement to public markets and benefit the Australian economy. However, ASIC considers itself to lag international peers in the data it has access to, and the breadth, depth and frequency needed to confidently supervise private capital funds.
What are regulators focused on?
Many private capital asset classes are available to retail investors, often through their superfunds, whose trustees have obligations to prudently select, manage and monitor the investments made available to members. Australian retail investors may not be able to fully assess the risks of private investments, in particular given the prevalence of real estate and private equity, both relatively non-transparent asset classes.
In addition, Australian private markets are concentrated among a relatively small number of funds and intermediaries with strong connectivity to the banking system and the broader economy.
ASIC has specified the following key concerns:
- Information asymmetries: opacity impedes the ability to make informed decisions and distorts competition by limiting comparability across investment opportunities.
- Conflicts of interest: complex structures require an alignment of incentives and robust governance frameworks to uphold the integrity and fairness of transactions.
- Valuation uncertainty: asset valuation often relies on models and discretionary assumptions rather than observable prices. Inaccurate or inconsistent valuations can mislead investors.
- Illiquidity: illiquidity creates challenges for investors seeking timely access to funds and amplifies the impact of adverse market conditions.
- Leverage: leverage can amplify losses and increase interconnectedness and systemic risk.
What will the regulators do?
ASIC’s focus is on increasing supervision and surveillance, refreshing targeted guidance, setting clear principles for private credit, recommending law reform to strengthen the wholesale funds regime, and working with industry to improve practices like disclosure.
This year, ASIC intends to conduct a pilot to access improved funds management data and calibrate baseline data needs across the sector. Standardization therefore becomes a strategic lever: higher quality data to move private market investments from opaque to observable, preparing asset managers and asset owners for a more data-intensive supervisory environment.
In practice, this favors operating models that can evidence consistent identifiers, data lineage and independent challenge while extracting instrument- and investor-level data without ad hoc spreadsheets or manual workarounds.
Elsewhere, initiatives by international regulatory bodies such as the International Organization of Securities Commissions (IOSCO) and the Financial Stability Board (FSB) point to regulators globally aligning on greater transparency and supervisory visibility in private markets.