Key Takeaways
- • Apollo will fill only 45% of withdrawal requests from Apollo Debt Solutions BDC after redemption requests equal to 11% of fund value, returning an estimated $730 million under its 5% quarterly cap.
- • Ares limited withdrawals from its Strategic Income Fund to 5% after requests exceeding 11% of value, or around $1.2 billion, with the requests largely coming from a limited number of family offices and smaller institutions.
- • Carlyle limited redemptions from its $7 billion Carlyle Tactical Private Credit Fund to 5% in the first quarter after requests totaling 15.7% of holdings.
- • BlackRock capped withdrawals from its $26 billion HPS Corporate Lending Fund at $620 million, or 5% of net asset value, after $1.2 billion in redemption requests.
- • Jamie Dimon said he is "not particularly worried" about systemic risk in private credit, while Goldman Sachs CEO David Solomon called the platform "very, very attractive" despite continued retail investor noise.
Summary
Private credit funds are facing a wave of redemption requests that has intensified investor concern about the health of the sector, which has grown rapidly as more retail investors are invited into the asset class. According to Business Insider, the latest headlines follow concerns that began in late 2025, although the publication notes private markets appear steady overall.
Several large managers have moved to restrict withdrawals under their quarterly 5% caps. Apollo said it would fill just 45% of withdrawal requests from its Apollo Debt Solutions BDC, which received requests equal to 11% of outstanding value in the first quarter, an estimated $730 million in payouts according to a filing. Ares said its Strategic Income Fund received requests exceeding 11% of its value, around $1.2 billion per a regulatory filing, and attributed the requests largely to a limited number of family offices and smaller institutions in select regions. Carlyle said it would limit redemptions from its Carlyle Tactical Private Credit Fund to 5% after requests totaling 15.7% of holdings, in a letter citing recent market volatility. BlackRock capped withdrawals from its $26 billion HPS Corporate Lending Fund, paying $620 million against $1.2 billion in requests, according to the Financial Times.
Ratings and bank actions have added to the pressure. Moody's downgraded FS KKR Capital Corp from Baa3 to Ba1, citing asset quality challenges and a net loss of $114 million over the fourth quarter. FSK said it remains well positioned with no 2026 unsecured maturities. Separately, JPMorgan reportedly restricted borrowing by some private credit funds after marking down loans, mostly to software firms, per Bloomberg, though the bank said the impact was limited. Blackstone reportedly tapped more than 25 executives to raise $150 million to meet redemption requests from a retail-offered credit fund.
Earlier episodes include Blue Owl's move to permanently change redemptions on its Capital Corporation II fund, which the Financial Times reported as a freeze; Blue Owl said it was changing the form of redemptions, not halting them. UBS has said private credit defaults could rise as high as 15% in a rapid AI disruption scenario, given software accounts for roughly 40% of PE-backed loans outstanding according to Bloomberg.
Senior leaders remain divided. Dimon said that large losses would be needed before banks are hit, while Solomon expects continued noise from retail investors. Apollo CEO Marc Rowan has warned of a possible "shakeout" in alternatives, and Mohamed El-Erian described Blue Owl's move as a potential canary-in-the-coalmine signal.
Several large managers have moved to restrict withdrawals under their quarterly 5% caps. Apollo said it would fill just 45% of withdrawal requests from its Apollo Debt Solutions BDC, which received requests equal to 11% of outstanding value in the first quarter, an estimated $730 million in payouts according to a filing. Ares said its Strategic Income Fund received requests exceeding 11% of its value, around $1.2 billion per a regulatory filing, and attributed the requests largely to a limited number of family offices and smaller institutions in select regions. Carlyle said it would limit redemptions from its Carlyle Tactical Private Credit Fund to 5% after requests totaling 15.7% of holdings, in a letter citing recent market volatility. BlackRock capped withdrawals from its $26 billion HPS Corporate Lending Fund, paying $620 million against $1.2 billion in requests, according to the Financial Times.
Ratings and bank actions have added to the pressure. Moody's downgraded FS KKR Capital Corp from Baa3 to Ba1, citing asset quality challenges and a net loss of $114 million over the fourth quarter. FSK said it remains well positioned with no 2026 unsecured maturities. Separately, JPMorgan reportedly restricted borrowing by some private credit funds after marking down loans, mostly to software firms, per Bloomberg, though the bank said the impact was limited. Blackstone reportedly tapped more than 25 executives to raise $150 million to meet redemption requests from a retail-offered credit fund.
Earlier episodes include Blue Owl's move to permanently change redemptions on its Capital Corporation II fund, which the Financial Times reported as a freeze; Blue Owl said it was changing the form of redemptions, not halting them. UBS has said private credit defaults could rise as high as 15% in a rapid AI disruption scenario, given software accounts for roughly 40% of PE-backed loans outstanding according to Bloomberg.
Senior leaders remain divided. Dimon said that large losses would be needed before banks are hit, while Solomon expects continued noise from retail investors. Apollo CEO Marc Rowan has warned of a possible "shakeout" in alternatives, and Mohamed El-Erian described Blue Owl's move as a potential canary-in-the-coalmine signal.
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