SINGAPORE Trends and Developments Contributed by: Hui Choon Yuen, Smitha Menon, Trevor Chuan and Felix Lee, WongPartnership LLP
packaged scheme of arrangement approved by the Singapore International Commercial Court under sec - tion 71 of the IRDA. Beyond real estate, elevated-growth tech credits that are similarly using these mechanisms are potential candidates for “loan-to-own” strategies (often via convertible or hybrid instruments), particularly where out-of-court solutions can be negotiated with bilateral protections and robust security packages. Cross-class cram-down: current law and policy watch Cross-class cram-downs currently require a major - ity in number and 75% in value of creditors across all classes to approve the scheme. However, in its report on 11 March 2025, the Committee to Enhance Singapore’s Corporate Restructuring and Insolven - cy Regime recommended lowering the threshold required to trigger cross-class cram-down, to make cram-downs more functional. The committee also recommended expanding the scope of cross-class cram-downs to encompass shareholders in appropri - ate circumstances, reflecting the economic reality of the debtor’s capital structure in a financially distressed situation. The proposed changes are driven by two key fac - tors. First, the existing high threshold requirements discourage the use of cross-class cram-downs. This contrasts with more lenient threshold requirements in key restructuring jurisdictions such as the UK and the USA. Second, the IRDA lacks provisions for share - holder cram-downs, even though shareholder approv - al may be required for certain restructuring plans. The committee’s proposed changes are intended not only to refine Singapore’s existing restructuring and insol - vency framework but also to strengthen its position as an attractive destination for private credit sponsors. Outlook: private credit expansion and Singapore’s hub role Despite persistent bank dominance, APAC private credit continues to expand from an opportunistic/ distressed base towards broader performing credit. Singapore provides increasingly execution-reliable forum-spanning DIP-style super-priority financing, pre-pack schemes, and cross-class cram-downs
while LME techniques (dropdowns/uptiers), hybrid capital (including payment in kind) and documentation discipline remain central to delivering risk-adjusted returns across heterogeneous regional legal regimes. For special-situations lenders, the combination of LME optionality and Singapore-anchored enforce - ment and restructuring pathways is likely to define the next cycle’s competitive edge in APAC. Practical takeaways for legal practitioners A practitioner advising on APAC private credit today should integrate four disciplines. Origination counsel must draft data-driven covenants and eligibility rules that suit digital lending and platform analytics, while preserving downstream distribution options. Bank - ing and capital markets specialists should harmonise loan and note terms to allow migration into private placements or securitisations without eroding lender protections. Real estate counsel must tailor security and intercreditor structures to development risk and local law nuances, ensuring that step-in, cash control and draw conditions are enforceable. Restructuring lawyers should pressure-test enforcement and res - cue-financing pathways at origination, documenting milestones and priority mechanics that will withstand judicial scrutiny. Counsel across all workstreams should also map licensing requirements for onshore lending and loan transfers, jurisdiction-specific secu - rity perfection and registration, and tax and capital control frictions that affect pricing, cash movements and enforcement. Across all these workstreams, the direction of trav - el is clear. APAC’s demand for flexible, bespoke credit is expanding, and Singapore’s frameworks enable regional scale. Digital platforms are widening access to working capital for small businesses that fuel employment and growth. Specialist lenders and bank partnerships are multiplying, with parallel lend - ing offering a pragmatic bridge between relationship banking and private capital. Real estate private credit is shifting from special situations to performing strate - gies with institutional sponsorship. The opportunity is substantial, but it rewards legal precision, disciplined valuation, robust governance and a deep understand - ing of cross-border execution.
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