Bloomberg Talks: Churchill Asset Management President & CEO Ken Kencel Talks Private Credit

Date: November 14, 2025
Guest: Ken Kencel, President & CEO, Churchill Asset Management
Host(s): Bloomberg Team

Episode Overview

This episode centers on the state and future of private credit—an asset class drawing massive interest from both legacy players and new entrants, including hedge funds. Ken Kencel, a seasoned industry leader, shares his insights on market dynamics, the advantages of middle market lending, the impact of tariffs and deregulation, and how Churchill Asset Management differentiates itself in a rapidly evolving landscape. The conversation also tackles the risks of fee compression and the challenge of maintaining value in a competitive field.

Key Discussion Points & Insights

The Boom in Private Credit and New Entrants

• Trend: Private credit has experienced explosive growth, with new players like hedge funds entering the space in search of yield.

• Kencel’s Perspective:

  • New market entrants (described as “tourists”) often focus on opportunistic, higher-yielding niches rather than relationship-driven lending.
  • Established firms benefit from deep relationships and differentiated sourcing, which, according to Kencel, will be critical for maintaining a competitive edge.

  “At the end of the day, private credit, in our view, is all about differentiated sourcing, origination and ultimately relationships.”
  —Ken Kencel [01:36]

  “You’ve got established players that have relationships built over decades... The new entrants that come in I think will probably focus more on opportunistic strategies...”
  —Ken Kencel [01:57]

Risks with Non-Specialist Entrants

• Host question: Hasn’t this story played out before—with new entrants making big moves that later backfire?

• Kencel’s Response:

  • Newcomers may seek returns in riskier/distressed areas.
  • Churchill remains focused on traditional mid-market lending, seeking stable, consistent returns from market-leading, non-cyclical businesses.

  “There are niches where those hedge funds will play. But it’s not where we play.”
  —Ken Kencel [03:29]

Churchill’s Middle Market Focus

• Market Niche: Churchill invests in U.S. firms with $10–100 million in EBITDA, primarily service-oriented, with minimal international exposure and manufacturing activities.

• Implications:

  • Insulation from external shocks like tariffs.
  • Lower international risk profile compared to larger, global organizations.

  “Very, very limited international customer base for these businesses... less than 10% are really impacted at all by tariffs.”
  —Ken Kencel [04:17]

Tariffs vs Deregulation

• Tariffs:

  • Largely a non-issue, with less than 10% of Churchill’s portfolio exposed.
  • Unexpectedly seen as a “positive” for fundraising, as investors find comfort in the insulation from tariff risks.

  “Our investors ... like the fact that there’s limited tariff exposure.”
  —Ken Kencel [04:48]

• Deregulation:

  • Reduces compliance burdens, especially for mid-market companies.
  • Acts as a net positive, enabling more efficient capital deployment.

  “Deregulation is a net positive overall.”
  —Ken Kencel [05:06]

The Data Center & “Re-Industrialization” Boom

• Discussion: Most private credit managers are eager to participate in large, infrastructure-type deals (such as data centers).

• Churchill’s Approach:

  • Rather than financing data centers directly, Churchill funds the myriad supportive businesses (e.g., HVAC, food service) that serve those projects.

  “We have about $6 billion invested... not in the data centers themselves, but in companies that are mid market companies that are supporting data centers.”
  —Ken Kencel [06:33]

  “There are thousands of companies in the mid market that are participating in that we finance... it’s a broad based benefit to the economy.”
  —Ken Kencel [06:48]

Continued Growth & Sticking to Core Strategy

• Investor sentiment: Strong interest in Churchill’s conservative, middle market approach.

• Growth Strategy: The firm is committed to “sticking to its knitting” and not chasing riskier or more commoditized segments.

  “Today they [investors] like the middle market and they want us to stay there. Right. So, they don’t want to see us…venturing off into some of these other areas. And we have absolutely no intention of doing that.”
  —Ken Kencel [08:01]

Fee Compression and Commoditization

• Industry-wide trend: Bigger players entering “syndicated loan” space are compressing spreads/fees, leading to asset-gathering strategies.

• Churchill’s Positioning:

  • Core middle market lending still enjoys a 200–250 basis point premium over syndicated loans.
  • Fewer competitors able to underwrite large, direct lending solutions keeps Churchill’s niche attractive.

  “Core middle market…has about a 2 to 250 basis point advantage over the syndicated market.”
  —Ken Kencel [09:12]

  “As you get into the larger deals, it’s a much, much more competitive dynamic.”
  —Ken Kencel [09:52]

Notable Quotes & Memorable Moments

• On relationships as the industry edge:

  “I think you will have new entrants. I think there are certainly places to go with that capital... But the new entrants that come in I think will probably focus more on opportunistic strategies...”
  —Ken Kencel [01:34–01:57]

• On tariffs being a non-issue:

  “So the tariff dynamic has actually turned out to be a pretty good thing for us.”
  —Ken Kencel [04:34]

• On sticking to the middle market:

  “We have absolutely no intention of doing that [branching out from mid-market]. But I think sticking to our knitting is important right now.”
  —Ken Kencel [08:10]

Important Segment Timestamps

• [01:31–01:57]: Kencel on new entrants and the importance of relationships
• [02:53–03:46]: Differentiation in private credit and Churchill’s sector focus
• [04:12–05:06]: How tariffs and deregulation impact Churchill’s portfolio
• [06:20–06:48]: Churchill's role in the “re-industrialization” and data center boom
• [07:43–08:10]: Growth expectations and executive strategy
• [08:45–09:52]: Industry fee compression and Churchill’s positioning

Final Takeaway

Ken Kencel positions Churchill Asset Management as a disciplined, relationship-driven middle market lender thriving amid new entrants, a crowded field, and shifting macro risks. He underscores the importance of focus, resisting the urge to chase scale or trends, and leveraging decades of expertise in a differentiated market. For investors and industry watchers, Churchill’s strategy epitomizes a “stick to your knitting” approach as private credit matures.