Financial Data and Key Metrics Changes - MSCI reported organic revenue growth of 9%, adjusted EBITDA growth of 10%, and adjusted earnings per share growth of over 15% in Q3 2025 [6] - The company repurchased $1.25 billion worth of shares in Q3, bringing year-to-date repurchases to over $1.5 billion, with an additional $3 billion authorized for future repurchases [6] Business Line Data and Key Metrics Changes - The index franchise achieved recurrent net new subscription sales growth of 27%, with 43% growth in the Americas [7] - Total AUM in investment products linked to MSCI indices reached $6.4 trillion, including $2.2 trillion in ETFs and $4.2 trillion in non-ETFs [7] - Analytics delivered recurrent net new sales growth of 16%, driven by strong adoption of risk tools and equity models by hedge funds [8] - Subscription run rate growth for wealth managers was nearly 11%, while asset owners posted 9% growth [12][14] - Subscription run rate growth for banks and broker dealers was 9%, with a record level of recurring sales [15] Market Data and Key Metrics Changes - Equity ETFs linked to MSCI indexes captured $46 billion of inflows during Q3 2025 [17] - The index retention rate remained durable at nearly 96% [17] - Sustainability and climate solutions saw an 8% subscription run rate growth, with climate solutions growing at 16% [19] Company Strategy and Development Direction - MSCI is focusing on expanding its presence in private credit and enhancing its client segmentation strategy [10][25] - The company is leveraging AI to enhance existing products and develop new capabilities, aiming for significant value creation for shareholders [9][41] - MSCI is committed to helping the active asset management industry recover by creating new products, particularly in the active ETF space [31][60] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term opportunities and the ability to drive growth from recent innovations [16] - The company is seeing solid momentum in delivering new products and capabilities, translating into tangible results [21] - Management acknowledged challenges in the sustainability and climate segment but emphasized the potential for monetization through indices [54] Other Important Information - MSCI launched a private credit factor model and a new global taxonomy for private assets, enhancing transparency and standardization [8][9] - The company is actively developing datasets and products for market makers and broker dealers to fuel liquidity [33] Q&A Session Summary Question: Strategy around private credit - Management is bullish on private credit, emphasizing the need for transparency tools for private credit funds to attract investors [24][25] Question: New products and marketing efforts - The strategy includes creating new products for the active asset management industry and expanding into other client segments [31][35] Question: AI opportunities and cost savings - AI is expected to dramatically increase margins by creating new products and reducing operational costs [63][64] Question: Sales momentum in asset management - The sales momentum is attributed to upselling additional content and services to existing clients, particularly in index [68] Question: Competitive moat against new entrants - MSCI's proprietary data and trusted brand create significant barriers to entry for competitors [72][75] Question: Performance of net new sales in EMEA - There was a decline in net new sales in EMEA, with management noting the need for further product innovation in that region [78]

Economic Impact of Government Shutdown - The ongoing government shutdown, now in its 28th day, is expected to slow down the economy due to the inability to obtain necessary government approvals for various activities [2][4] - The shutdown affects a significant number of government employees, estimated at 250,000 to 300,000, who are also customers of the company [3] IPO and M&A Activity - The company had a strong third quarter with numerous IPOs and increased M&A advisory revenue, but the fourth quarter may present challenges due to the SEC being closed, hindering IPO filings [1][5] - Despite the shutdown, M&A deals continue to progress, with two deals announced recently [6] Credit Quality and Concerns - The company reports that its exposure to recent banking sector issues, including bankruptcies and fraud concerns, is not material [7][8] - Credit quality has improved post-pandemic, with charge-off rates normalizing to levels similar to 2019, which was a low point for credit costs [8][9] Private Credit Market - The rise of private credit, particularly from firms like Blackstone and Apollo, poses competitive risks to traditional banking, as many loans are now being made outside the banking system [16][17] - The company emphasizes the importance of maintaining customer relationships and providing compelling reasons for clients to choose traditional banking over private credit options [18] Regulatory Environment - The company anticipates a more favorable regulatory backdrop with the upcoming resolution of the Basel 3 endgame, which could impact capital requirements and overall banking operations [19]

Core Viewpoint - Citigroup CEO Jane Fraser expressed skepticism about the future of the private credit market, questioning whether it will function as a collaborative effort or remain competitive [1] Group 1: Private Credit Market - Fraser hopes that private credit will collaborate with other financing forms to provide solutions that can foster development in areas such as artificial intelligence [1]

Private credit funds are pumping more money into newly formed joint ventures as a way of providing financing, a structure that doesn’t add debt to the balance sheet of the company receiving the funds https://t.co/cvkyBF67jo ...

Blackstone is leading a private credit financing for life-sciences company Signant Health to replace more than $1 billion in bank-led leveraged loans, according to people familiar with the transaction https://t.co/tcSvplJeQM ...

sei settles apollo's private credit in 390ms vs 30 days in tradfi. that's 6.7 million percent faster settlement unlocking $650b in previously frozen liquidity. every basis point of apollo's aum that moves on-chain adds $65m tvl to sei. current sei tvl: $400m. do the math on that multiple ...

Private credit titans like Goldman and Apollo are jockeying for more deals in Saudi Arabia, where banks are facing weak liquidity https://t.co/7RLRUrawzt ...

Core Insights - Franklin Resources Inc. has completed the acquisition of Apera Asset Management, enhancing its alternatives platform and expanding its presence in Europe's lower middle market [1][4]. Company Overview - Apera Asset Management, based in London with offices in Munich, Paris, and Luxembourg, is a pan-European private credit firm managing €5 billion (approximately $5.868 billion) [2]. - Founded in 2016, Apera focuses on providing senior secured private capital to private equity-backed companies in Western Europe, particularly in the lower middle market [7]. Market Context - The private credit market is rapidly growing, with Moody's projecting that assets under management (AUM) in this sector will reach $3 trillion by 2028 [5]. - Small and medium-sized enterprises (SMEs) represent 99% of the European Union's 32.3 million enterprises, indicating a significant opportunity in the lower middle market, which has been constrained by limited bank lending [3]. Strategic Implications - The acquisition increases Franklin Templeton's alternative credit AUM to $90 billion, raising its total alternative AUM to approximately $270 billion, solidifying its position as a leading manager of alternative assets [4][6]. - The integration of Apera is expected to diversify Franklin Templeton's geographic exposure and enhance its capabilities within the private credit asset class [6].

>> FROM NEW YORK CITY FOR OUR VIEWERS WORLDWIDE, BLOOMBERG REAL YIELD STARTS RIGHT NOW. SCARLET: COMING UP, THE LONG-AWAITED AND LONG DELAYED TO SEPTEMBER CPI REPORT WAS BENIGN, SHOWING INFLATION AT THE SLOWEST PACE IN THREE MONTHS. OFFERING A PATH FOR THE FEDERAL RESERVE TO CUT INTEREST RATES BEYOND NEXT WEEK'S MEETINGS.SOME OF THE BIGGEST VOICES ON THE STREET WEIGHING IN ON POSSIBLE CRACKS IN THE CREDIT MARKET. WE BEGIN WITH A BIG ISSUE, A SOFTER THAN EXPECTED CPI PRINT. >> IT IS GENERALLY A BETTER-THAN-E ...

Group 1 - The recent CPI report indicates inflation is at its slowest pace in three months, which may lead the Federal Reserve to consider interest rate cuts beyond the upcoming meetings [1][4][7] - Traders are now expecting nearly four quarter-point cuts by June 2026, reflecting a shift in market sentiment following the CPI data [4][5] - The core inflation rate, excluding food and energy, showed a gain of 0.20%, which is better than expected, reinforcing the case for potential rate cuts [4][10] Group 2 - Concerns are raised about the credit market, with some analysts noting potential cracks due to recent economic data and consumer sentiment [2][31] - The bond market is facing a dilemma as inflation remains elevated above the Fed's 2% target, complicating the rationale for rate cuts [8][10] - The sovereign debt market is expected to crowd out corporate debt due to increased global spending, particularly in developed markets [21][22] Group 3 - The high-yield credit spread is starting to widen, which some view as an opportunity to add selective exposure in certain sectors [31][36] - There is a notable divide in the economic landscape, with larger companies managing better through economic changes compared to small and medium-sized businesses [18][19] - The current economic environment is characterized by a K-shaped recovery, where certain sectors are thriving while others, particularly lower-income segments, are struggling [15][20]