Private credit feels the pressure

Apollo Global Management has limited investor withdrawals from its Apollo Debt Solutions (ADS) in the first quarter of 2026, highlighting growing pressure in private credit markets.

Investors requested more than $1.5 billion in redemptions, about 11.2% of the fund’s shares from a vehicle with a net asset value of $14.5 billion.

Apollo capped payouts at 5%, or roughly $730 million, in line with standard limits for such funds. It returned money on a pro rata basis, giving investors about 45% of what they had asked for. 

Even as outflows rose, the fund raised $724 million in fresh capital, suggesting mixed investor sentiment.

Apollo is not alone
Ares Management Corp also curbed withdrawals from some of its funds.

The company limited withdrawals from its $10.7 billion private credit fund, capping redemptions at 5% of shares after investors requested 11.6%, according to a shareholder letter.

To reassure investors, private credit firms like Blackstone and Blue Owl Capital have allowed withdrawals above the guaranteed minimum.

Shares of several alternative asset managers have declined by double-digit percentages this year.

Concerns over transparency, lending standards, and exposure to software companies facing disruption from artificial intelligence have weakened confidence in private credit.

The firm cited market volatility and liquidity worries as key risks but said its $25 billion portfolio and relatively lower exposure to software position it to navigate challenges.

The move by Apollo and Ares triggered a market reaction. Ares and Apollo shares fell more than 4% Tuesday. TPG Inc., Blackstone Inc., KKR & Co. Inc., and Blue Owl Capital Inc. also traded lower as the financial sector dipped up to 0.8%.