Asia Leads Global Growth as Banks Seek Private Capital | Apollo APAC Outlook

What's New

In Apollo Global Management's 2026 APAC Outlook, Matt Michelini, Partner, details how Asia Pacific stands at an inflection point where structural strengths, demographic tailwinds, and industrial transformation are converging to create the world's most attractive investment environment—with the region driving roughly 60% of global GDP growth in 2025 while Asian banks controlling 80% of corporate lending increasingly turn to private capital partners to address balance sheet constraints.

Why It Matters

The emergence of an "Asia for Asia" dynamic—marked by trade realignment, supply chain diversification, and deepening intra-Asian capital flows—signals that the region is no longer just a growth story but a structural transformation story where private capital is becoming essential infrastructure for the next phase of global economic expansion.

Big Picture Drivers

• Industrial supercycle: Multi-year capital investment wave in digital infrastructure, power grids, data centers, logistics hubs, and advanced manufacturing is creating decade-long investment trends

• Bank balance sheet strain: Asian banks facing growing constraints as regional capital requirements outpace their lending capacity, driving demand for private capital partnerships

• India emergence: Projected 6.2% GDP growth in 2026 underpinned by strong demographics, rapid digitization, and deepening capital markets offers one of the most attractive risk-adjusted profiles globally

• Japan sophistication: Private capital ecosystem has expanded materially in scale and sophistication, with mega-banks increasingly focused on ROE and balance sheet velocity

• Regional self-sufficiency: Trade realignment and supply chain diversification are creating an industrial renaissance with strong capital investment focus

By The Numbers

• 60%: Asia's share of global GDP growth in 2025

• 4.5-4.9%: Regional economic growth rates across Asia Pacific

• 6.2%: India's projected GDP growth for 2026

• ~80%: Share of Asian corporate lending controlled by regional banks

• 10+ years: Expected duration of infrastructure capital expenditure trend

Key Trends to Watch

• Bank partnership acceleration: Japanese financial institutions are leading a shift toward private capital partnerships for infrastructure, energy, and technology investments—a model now spreading across the region.

• Sponsor liquidity solutions: Limited exit pathways and compressed returns are creating demand for innovative portfolio company and fund-level liquidity solutions for PE and infrastructure sponsors.

• Southeast Asia momentum: Indonesia and Vietnam are benefiting from domestic consumption and foreign investment reinforcing each other amid manufacturing relocation trends.

• Asset-backed expansion: From loan portfolio partnerships to structured capital arrangements, new models are allowing banks and private investors to operate more efficiently together.

The Wrap

Apollo positions 2026 as a moment to participate actively rather than sit on the sidelines—where the convergence of capital demand, policy reform, and private market sophistication is creating a self-sustaining investment ecosystem that rewards adaptability, scale, and deep local presence over traditional public market approaches.