Key Takeaways
- • Ares Management co-founder and CEO Michael Arougheti says institutional investors are not anxious about private credit and are not allocating away from the asset class, per TradingView coverage of his remarks.
- • Arougheti argues recent stress in the private credit market is tied to private equity rather than to private credit itself, and that the market remains strong.
- • Arougheti states that 97% of Ares' wealth clients have not asked about AI or private credit risks, which he characterizes as "odd" and "frustrating" fears in media coverage.
- • Ares reportedly raised a record $30 billion in fundraising, which Arougheti cites as evidence of investor confidence.
- • In a published essay, Arougheti contends private credit has a perception problem, and points to a roughly 1% annual net realized loss rate over two decades versus 1.5% for high-yield bonds.
Summary
Ares Management co-founder and CEO Michael Arougheti has said that institutional investors are not anxious about private credit risk and are not reducing their allocations to the asset class, according to TradingView coverage of his remarks. He characterized investor reaction as an opportunity rather than a retreat, and framed recent market stress as linked to private equity rather than to the private credit market itself. The full article could not be retrieved, so these points are drawn from headlines and excerpts of related coverage.
In comments reported at the Forbes Summit and in other interviews, Arougheti said the private credit market remains strong. He described fears about AI and private credit as "odd" and "frustrating," and said 97% of Ares' wealth clients had not asked about those risks. Coverage also cites a record $30 billion fundraising haul for Ares, which Arougheti pointed to as a sign that institutional capital is staying in the strategy.
In a separate essay on the firm's website, Arougheti argued that the term "private credit" carries a perception problem, often associated with opaque deals and hidden risk. He contended that private credit is simply credit: capital extended to borrowers in exchange for repayment with interest. He cited a roughly 1% annual net realized loss rate over two decades, compared with 1.5% for high-yield bonds and a 1% net charge-off rate for syndicated bank loans, and said private credit managers continued lending during the 2023 banking stress when banks pulled back. He also cited more than $400 billion of committed but uninvested private credit capital.
Some commentary has been more cautious. One Ares-related headline notes that some investors are growing wary of a potential private credit bubble, and another reports Arougheti blaming bank consolidation for banks' pullback in lending. These views are attributed to the commentary and do not reflect a consensus on the sector's risk outlook.
In comments reported at the Forbes Summit and in other interviews, Arougheti said the private credit market remains strong. He described fears about AI and private credit as "odd" and "frustrating," and said 97% of Ares' wealth clients had not asked about those risks. Coverage also cites a record $30 billion fundraising haul for Ares, which Arougheti pointed to as a sign that institutional capital is staying in the strategy.
In a separate essay on the firm's website, Arougheti argued that the term "private credit" carries a perception problem, often associated with opaque deals and hidden risk. He contended that private credit is simply credit: capital extended to borrowers in exchange for repayment with interest. He cited a roughly 1% annual net realized loss rate over two decades, compared with 1.5% for high-yield bonds and a 1% net charge-off rate for syndicated bank loans, and said private credit managers continued lending during the 2023 banking stress when banks pulled back. He also cited more than $400 billion of committed but uninvested private credit capital.
Some commentary has been more cautious. One Ares-related headline notes that some investors are growing wary of a potential private credit bubble, and another reports Arougheti blaming bank consolidation for banks' pullback in lending. These views are attributed to the commentary and do not reflect a consensus on the sector's risk outlook.
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