KBRA Releases Research – Private Credit: Asset Managers 2Q26 Performance Recap—Relatively Resilient but Dispersion in Performance Pronounced

KBRA released research summarizing 2Q26 performance trends across its rated universe of 70 asset managers, as well as results for publicly listed alternative asset managers in North America and Europe. According to the agency, alternative asset managers entered 2H26 from a position of relative strength, with the sector's resilience holding despite ongoing macroeconomic, geopolitical, and market uncertainty. Assets under management and fee-paying AUM trends were generally constructive, supported by fundraising, deployment, and continued expansion across credit, infrastructure, insurance, and private wealth strategies.

Performance dispersion, however, remains pronounced across managers and products. KBRA attributes this to differences in fundraising momentum, deployment rates, investment performance, and product and investor mix. Weakness is relatively concentrated in select software investments, older private equity vintages, office real estate, and certain credit and infrastructure assets, including select renewable energy and digital infrastructure investments exposed to valuation, development, financing, or demand-related risks. Credit fund performance was largely resilient despite periods of weaker market sentiment, with limited evidence of broad-based deterioration.

Infrastructure remained an area of fundraising strength, particularly in digital and energy-related assets. KBRA notes, however, that strong capital formation relative to available transactions has increased deployment pressure in parts of the infrastructure market, raising the importance of mandate and underwriting discipline. Fundraising continued to favor scaled, diversified platforms with broad product capabilities and established institutional relationships, contributing to greater concentration of industry inflows, while capital formation broadened beyond traditional flagship funds.

Realization activity generally improved during 2Q26, though the pace of recovery varied by manager, and distributions remain below historical norms with holding periods extended. Private wealth trends were mixed: growth at some managers was offset by elevated redemption activity in certain evergreen and private credit products, with managers exposed to redemption-eligible retail and wealth products facing more visible flow and liquidity management pressure. Strategic M&A and partnerships remained active in 2026, particularly among larger diversified managers, and partnerships with insurers continued to deepen, providing access to long-duration capital.

KBRA's rated universe, which has expanded since 2019, spans private equity and private credit, real estate, infrastructure, and wealth management firms with ratings from AA through below-investment grade. More than one-quarter of the rated portfolio consists of managers based outside the U.S., primarily in Europe. KBRA states it continues to monitor underwriting and risk discipline, deployment pressure, infrastructure exposures, AI-driven disruption, and redemption and liquidity risks, and expects these to remain generally contained for the rated portfolio.