Unlocking Canada's Mid-Market Potential: How National Bank and Apollo Are Redefining Private Credit Access

The Canadian mid-market—defined by companies with annual revenues between $50 million and $1 billion—is a critical engine of economic growth. Yet, it has long faced challenges in accessing capital that matches its scale and potential. Enter National Bank Investments (NBI) and Apollo Global Management, whose partnership launched in May 2025 aims to transform this landscape by expanding private credit access. Their collaboration, embodied in the NBI Apollo Private Credit Fund, represents a strategic pivot to democratize institutional-grade debt solutions for Canadian mid-market businesses.

The Fund's Structure and Strategic Focus

The NBI Apollo Private Credit Fund targets Canadian accredited investors, offering exposure to Apollo Debt Solutions BDC—a U.S. non-traded business development company. While the fund's primary focus is on senior secured loans to large corporates and broadly syndicated loans, its secondary emphasis on middle-market direct lending is a deliberate nod to unlocking the untapped potential of Canada's mid-sized firms.

Apollo's global scale—managing $785 billion in assets as of March 2025 and operating 16 origination platforms—provides NBI with a robust infrastructure to source deals. This partnership leverages Apollo's ability to originate tens of billions in private credit annually, combined with National Bank's $536 billion in assets under management, to create a bridge between Canadian investors and opportunities traditionally reserved for institutional players.

Why the Mid-Market Matters—and How This Partnership Addresses Gaps

Canada's mid-market is a $1.2 trillion sector, accounting for roughly 40% of GDP. Yet, these companies often struggle to secure financing that balances growth needs with risk mitigation. Traditional banks may balk at the complexity of mid-market deals, while public markets demand scalability that many mid-sized firms lack. Private credit, by contrast, offers flexibility: customized terms, senior secured structures, and long-term horizons.

The NBI Apollo Fund's focus on syndicated loans and large corporate deals indirectly benefits mid-market players. Syndication allows Apollo to pool resources for larger transactions, freeing up capacity to underwrite smaller, high-growth ventures. Additionally, the fund's exposure to Apollo's broader origination ecosystem—spanning asset-backed and specialty lending—creates a pipeline for mid-market opportunities.

Risks and Considerations for Investors

While the fund's potential is compelling, its suitability hinges on investor profiles. Private credit is inherently less liquid than public securities, and defaults can disproportionately impact returns. NBI emphasizes that the fund is not for conservative investors, requiring a tolerance for volatility and a multi-year horizon.

Key risks include:
- Credit Risk: Mid-market firms, while growth-oriented, may face operational or sector-specific challenges.
- Interest Rate Sensitivity: Private debt instruments are often fixed-rate, making them vulnerable to rising rates.
- Regulatory Compliance: Ensuring adherence to Canadian securities laws while accessing U.S.-based structures adds complexity.

Investment Thesis: A Strategic Play for Diversification

For accredited investors seeking alternatives to volatile public markets, the NBI Apollo Fund offers a compelling opportunity. The Canadian private credit market is projected to exceed $2.5 trillion by 2025, driven by demand for yield and diversification. By partnering with Apollo—a firm with a 35-year track record—NBI is positioning itself as a gateway to this growth.

Actionable Advice:
- Consider the Fund as an Allocation Tool: Allocate 5-10% of a diversified portfolio to private credit, balancing it with public equities and fixed income.
- Focus on Long-Term Returns: Private credit's value emerges over 5+ years, aligning with mid-market firms' growth cycles.
- Due Diligence is Critical: Review Apollo's historical default rates and NBI's risk management practices before committing.

Conclusion: A New Era for Canadian Capital Markets

The NBI Apollo partnership marks a turning point in Canada's financial landscape. By leveraging Apollo's global expertise and National Bank's domestic reach, they're not just expanding access to private credit—they're redefining how mid-market companies secure the capital needed to scale. For investors willing to navigate the risks, this fund could be a cornerstone of portfolios built to thrive in an increasingly fragmented global economy.

As the mid-market continues to drive innovation and employment, the partnership's success will hinge on its ability to balance risk and growth—a challenge both firms appear poised to tackle.