Private debt funds are set to become a "permanent" feature of the European capital market, as asset managers and private equity firms step in to fill the gap left by a decrease in bank lending, according to ratings agency Moody’s.

Moody's highlights sharp growth in the European private debt market in a new report. As of May this year more than 60 new private debt funds in Europe were raising $33 billion in capital, according to Moody's.