March 21 (Reuters) - Goldman Sachs Asset Management said

on Thursday it had raised over $700 million for a new fund that

will work with external managers to identify investment

opportunities in both public and private markets.

The fund, Union Bridge Partners I, will work together with

private credit firms and hedge funds and is part of Goldman's

$340 billion External Investing Group.

Union Bridge has already deployed 40% of the capital

raised to companies across North America and Europe in sectors

such as hospitality, software, fitness centers, and music

royalties.

Wall Street banks are raising billions of dollars to regain

lost ground in financing debt-backed deals after private equity

firms and asset managers muscled into the business in recent

years.

The asset management arm of Goldman Sachs ( GS ) is looking

to expand its private credit portfolio to $300 billion in five

years, Reuters reported earlier this month.

"We have seen a significant increase in the opportunity to

partner with our external managers to provide flexible capital

solutions to companies across public and private markets," said

Philip Pallone, who leads the Union Bridge program.

Goldman raised the capital from institutions, private wealth

clients, and family offices, apart from commitments from its own

employees.