Private‑credit squeeze cracks open
Investors are locked out of more than $4.6B in private‑credit redemptions as funds hit withdrawal limits — forcing some managers to curb redemptions and prompting JPMorgan to plan a vehicle that allows 7.5% quarterly redemptions while Blue Owl says defaults haven’t spiked yet — banks are circling to reclaim leveraged‑loan market share. (bloomberg.com) (bloomberg.com) (cnbc.com)
Bloomberg estimates investor requests to pull roughly $13 billion from more than a dozen private‑credit funds this quarter, leaving in excess of $4.6 billion locked behind withdrawal limits, based on data from Robert A. Stanger & Co. and Bloomberg’s survey of managers. (bloomberg.com) Apollo Global Management and Ares Management were among the latest firms to impose redemption caps this week, joining earlier moves by BlackRock and Morgan Stanley to limit outflows from semi‑liquid credit vehicles. (bloomberg.com) Those semi‑liquid structures commonly cap withdrawals at either 5% or 7% of NAV each quarter, a design that meant funds could only satisfy roughly two‑thirds of the cash investors sought when demand surged. (bloomberg.com) JPMorgan has filed to launch the “JPMorgan Public and Private Credit Fund,” proposing 7.5% quarterly redemptions and asking the SEC for an exemption to repurchase at least 2% of outstanding shares each month while keeping the option for monthly withdrawals. (bloomberg.com) Blue Owl co‑CEO Doug Ostrover told Bloomberg the firm has not seen an increase in loan defaults across its portfolios even as it has taken steps to manage liquidity in retail‑facing vehicles. (bloomberg.com) CNBC reports Wall Street banks are positioning to win back leveraged‑loan market share lost to private lenders after a decade of direct‑lender growth, citing improved loan market liquidity and banks’ capacity to underwrite syndicated deals. (cnbc.com) Bloomberg has previously documented banks reclaiming roughly $16 billion of deals that had gone to private credit over prior periods, a track record banks are citing as they step up outreach to private‑equity sponsors now facing constrained private‑credit capacity. (bloomberg.com)
