April 21 (Reuters) – Big fund managers and investors are pouring money into private credit fund managers and business development companies (BDCs) even as these firms face redemptions and scrutiny over their opaque portfolios.
Bond fund manager PIMCO became a talking point in debt markets last week when it bought all of the $400 million of bonds sold by private credit firm Blue Owl Capital.
Other fund raisings have taken place, some via collateralised loan obligations and others via share placements and bond issues.
Golub Capital, which has huge exposure to the software services sector that investors worry about, launched a direct lending fund that raised approximately $320 million from 14 institutional investors.
More interestingly, exchange-traded funds investing in private credit and business development companies have drawn record inflows, even as concerns grow over redemption pressures and valuation risks in the asset class.
According to LSEG Lipper, 22 BDC funds received $868 million in the first quarter of the year, the biggest ever. The biggest flows were to the State Street IG Public & Private Credit ETF, which had inflows of about $700 million.
“We’re not seeing in our flows what we’re seeing in the headlines,” said Brandon Rakszawski, head of product development at VanEck, referring to the steady inflows into the asset manager’s two exchange-traded funds, one of which GPZ invests in alternative asset management firms such as Blackstone, KKR, Apollo Global Management and Ares Management.
GPZ, or the VanEck Alternative Asset Manager ETF, has $214.8 million of assets under management, has seen no outflows in the last three months and received inflows of $110.06 million.
“Doomsday headlines may be overstating the actual level of risk,” Rakszawski said. “Our flows are telling us a different story: that investors view this as an opportunity to invest at a discount to recent prices.”
Goldman Sachs Private Credit Corp. said it priced $750 million in 6.15% fixed-rate notes due in 2031 to pay down revolving credit facilities and diversify its funding.
StepStone’s private credit fund raised $88.7 million in March and holds $3.19 billion in investments against $1.24 billion in debt.
BlackRock Private Credit Fund raised about $38 million in new institutional capital in early March 2026.
Point Credit Income Fund raised roughly $11.85 million in April.
(Editing by Vidya Ranganathan and Susan Fenton)
By Patturaja Murugaboopathy and Suzanne McGee