Apollo Warns Private Credit Redemptions May Keep Rising

Benzinga reported Thursday that Apollo Global Management President Jim Zelter cautioned investors that private credit redemptions are unlikely to stop soon. Speaking at Bernstein’s Strategic Decisions Conference in New York, Zelter said the withdrawal cycle already underway may have further to run.

Outflows Exceeded Inflows Earlier This Year

Earlier in 2026, cash pulled from Apollo’s semi-liquid private credit vehicles outpaced fresh contributions. These products primarily serve wealthy individual investors and channel capital into loans for mid-sized companies. Zelter acknowledged that fund performance across March, April, and May was solid. Despite that, he stopped short of predicting any near-term easing in exit requests.

He noted that standard fund structures typically limit quarterly repurchases to around 5% of assets. Even so, he flagged a tactical risk. Some investors may deliberately time requests to hit those caps, potentially pushing redemption volumes higher. “There may be even a little bit of an increase if people want to game the system,” Zelter said, per Benzinga. He added that the industry is “not through the turbulence yet.”

Valuation Concerns and AI Disruption Drive Unease

Zelter linked the broader withdrawal trend to lingering investor anxiety about private credit fundamentals. Questions persist over how loans are being priced and whether borrowers can withstand pressure from artificial intelligence-driven business disruption. Investors are also scrutinizing how resilient mid-market companies will prove as technology reshapes their industries. That cocktail of uncertainty has made some allocators cautious about holding illiquid positions.

A Sector-Wide Pattern

Apollo is not alone in absorbing elevated redemption requests. Benzinga noted that firms including BlackRock, JPMorgan, and Morgan Stanley have all capped withdrawals from comparable vehicles. Oaktree Capital Management took a different path, choosing to honor all redemption requests for the first quarter at 8.5% of its private credit fund. Its Oaktree Strategic Credit Fund separately announced plans to repurchase roughly 13.9 million shares, equal to about 6.8% of outstanding stock.

Investor Behavior Varies by Region and Channel

Zelter offered a more nuanced reading of the investor base, noting that withdrawal behavior differs meaningfully across geographies and distribution channels. Some markets are holding up better than others. He drew a candid distinction between those with genuine long-term conviction and those he described as shorter-term visitors to the asset class. How those two groups behave over the next few quarters will shape the private credit redemption picture considerably.

Also Read: Private Markets Face Liquidity Test as Wealth Allocators Pull Back