Goldman and BlackRock Calm Private Credit Panic. Blue Owl Less So

Panic over for private credit? Not quite. Things are calmer after banks and fund managers have made reassuring noises on quarterly earnings calls this month, but a shakeout is still underway. Many individual investors want their money back even as big institutions including insurers and pension funds are happy to keep investing. The trouble isn’t over for firms that rely more on wealthy people as clients — and that to my mind is a good thing.

Blackrock Inc., Goldman Sachs Group Inc., and Morgan Stanley all reported healthy inflows to the private credit funds they manage during the first quarter. They said institutional investors were ploughing more cash into the industry, which makes loans that don’t trade on markets and are often to riskier borrowers such as companies owned by private equity.