Barings private credit fund curbs redemptions amid investor exodus
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The news: US investment management firm Barings has capped redemptions at one of its private credit funds after investors sought to pull over 11% of shares during the first quarter.
The numbers: A regulatory filing published by Barings Private Credit Corp on Monday said that it capped withdrawals at 5%, after investors requested to pull 11.3% of shares earlier this year.
The context: A letter to shareholders included in the filing said the fund aims to balance near-term liquidity needs with “prudent stewardship of capital” for exiting and remining investors.
“Periods of market turbulence — driven today by factors ranging from rapid technological change to geopolitical uncertainty —often coincide with shifts in credit pricing and structure, creating attractive opportunities for lenders with the discipline, access, and flexibility to deploy capital selectively”, the letter continued.
Barings is the latest in a series of private credit funds to cap redemptions, as investors increasingly seek to pull money from the market as concerns rise over exposure to software businesses threatened by AI and loan quality.
“We believe the Fund’s balance sheet remains well positioned, with substantial available liquidity, long-dated and diversified funding sources, and moderate leverage, providing flexibility to deploy capital selectively as opportunities emerge”, the letter added.
The source: Barings Private Credit Corp filing
