BlackRock has capped withdrawals from its $26 billion HPS Corporate Lending Fund after investors tried to pull out nearly 10% of the fund’s asset value in a single quarter, nearly double what the fund would allow, FT reports.
BlackRock approved just over half of the $1.2 billion in redemption requests it received. Once the requested payouts exceeded 5%, BlackRock could limit withdrawals. BlackRock has fallen 5.1% so far on Friday.
The broader context is that private credit is showing real cracks. A string of writedowns at funds run by KKR, Apollo, and Blackstone are unnerving investors. Blue Owl last month went further than BlackRock, permanently halting redemptions at one of its funds altogether.
BlackRock insists the withdrawal limit is not a sign of distress.
