Alternative asset manager Blackstone has signed a definitive agreement to finance the acquisition of HSBC’s A$36 billion (US$25 billion) Australian home loan book.

The agreement represents the largest home loan portfolio deal globally to date. Capital for the deal comes from funds managed by Blackstone Credit & Insurance, Blackstone Tactical Opportunities and Blackstone Real Estate Debt Strategies.

The transaction highlights Blackstone’s capacity to structure large capital solutions for major financial institutions. It also extends the group’s investment footprint in Australia, where it has operated for nearly 20 years.

Dan Leiter, Head of International for Blackstone Credit & Insurance, said: “International expansion is a major priority for our private credit business. Blackstone’s global credit platform, deep origination capabilities, and long-standing relationships position us to deliver unique value to clients around the world. This marquee investment is a testament to the power of our franchise and our conviction in the growing opportunities in credit across Asia.”

Local loan management for the home loan book will fall to Pepper Money, one of the leading non-bank lenders in Australia and New Zealand. Founded in 2000 as a specialist residential lender, Pepper Money brings over 26 years of experience to the operation. The firm will work alongside Blackstone to ensure a smooth transition from HSBC for mortgage holders.

Mike Culhane, Head of International Business Development for Asset Based Finance, Blackstone Credit & Insurance, said: “We are pleased to invest in a high-quality Australian home loan portfolio while supporting a seamless transition for HSBC customers and helping them maintain competitively priced loans. With Pepper Money providing experienced local loan management, customers can continue to receive high standards of service. We strive to oversee this portfolio thoughtfully and with discipline and remain committed to Australia as a highly attractive market for long-term credit investment.”

The takeover aims to maintain high customer service standards and competitive loan terms throughout the migration process.

Mario Rehayem, Chief Executive Officer of Pepper Money, said: “Pepper Money’s appointment as the loan manager reflects the strength of our established platform and our experience supporting customers across large, complex portfolios. For more than 26 years, we have both originated and serviced loans on behalf of third parties. With the scale, systems, and focus on customer care, we are well placed to provide a positive customer and partner experience through transition. Alongside Blackstone and HSBC, our focus will be on disciplined execution, continuity for customers, and clear, genuinely helpful support at every step.”