IMCO's Jennifer Hartviksen on the Shifts in the Credit Market

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On July 23, 2025, IMCO's Jennifer Hartviksen, Managing Director and Head of Global Credit, joined ION Analytics for a fireside chat on shifts in the credit market. She discussed structural changes in lending, outlined key risks and opportunities and emphasized the importance of culture in IMCO’s partner selection process.

 This is a great discussion which I embedded below.

Jennifer goes over her background, working in Brazil, learning about credit investments there ("glass is half full" philosophy) then worked in Los Angleles before coming back to Canada to work at pension funds, Invesco and joining IMCO two months before the pandemic hit back in 2020 (Christian Hensley  hired her, he is no longer with the organization).

What attracted her to IMCO was the opportunity to build a credit strategy from scratch which "encompasses everything from philosophy, process and people."

Jennifer explains how in credit, the questions are always the same and fall in a couple of key buckets:

How are cash flows generated? Focusing always on cash flow generation, asset coverage, and the structuring of the credit papers itself, what are the protections being offered to the borrowers, be it covenants, possible equity upside, downside protections? Those are the questions I was asking then (in Brazil) and that I'm asking now. And understanding each of those dynamics in the context of how we are being compensated for those dynamics and that risk.

If you haven't figured it out yet, credit investors are very different animals than equity investors, it's all about protecting downside risk, delivering the highest possible risk-adjusted returns.  

They're not looking to shoot the lights out, they're looking to deliver consistent high single digit returns with an inflation protection as the rates are variable and adjust with inflation. 

Jennifer explains how they put together a credit strategy that looks across public and private credit and she explains how it’s the same team looking at all credit opportunities across the spectrum.

She states they're not pressured to put money at work in any one segment but where they see the best relative value. 

Their team is flexible and understands issuers who are looking for flexibility to work across public and private markets.

Anyway, take the time to listen to this interview, it's excellent and I'm glad IMCO posted it (interns take note, this is great stuff, I wish other pension funds posted interviews like this with their senior investment professionals).

I'm also bringing this up because Bloomberg came out with a story earlier today on how pensions funds missed the tech rally:

Interestingly, Oaktree’s Howard Marks sees the early days of a bubble, akin to 1997, when there were several more years of gains before big losses. “This is a time to put a little more defense into your portfolio & investing in credit as opposed to equities is one way to do it”:

Of course, things are also frothy in credit markets:

Whether or not we are in a bubble, my own perspective is pension funds learned a painful lesson back in 1999-2002 and in the 2008 GFC and none of them are willing to repeat those mistakes, chasing yield at any cost and then getting slammed hard when assets get clobbered and yields sink during a financial crisis (double whammy especially for pensions that manage assets and liabilities).

Nowadays, pension funds are more willing to miss the upside as long as they remain highly diversified across sectors, strategies, geographies, etc.

They might feel the pain of relative underperformance to the S&P 500 but their goal is to meet their future liabilities with the least possible volatility and that's their main focus.

That's another reason why credit investments have taken off at pension funds.

And at IMCO, like the rest of the big pension funds, they rely heavily on their strategic partners to gain the best exposures across public and private credit.

Alright, let me wrap it up there, please take the time to listen to this excellent interview with Jennifer Hartviksen, Managing Director and Head of Global Credit at IMCO.

Also, Oaktree Capital Management Co-Chairman Howard Marks says he finds stocks expensive “relative to what I call fundamentals, or you might call reality,” but says there’s no reason to think there’s a correction coming. He is joined by Bloomberg's Jonathan Ferro and Lisa Abramowicz on "Bloomberg Surveillance."

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