🚨 BlackRock restricts withdrawals in $26B private credit fund

BlackRock limited withdrawals from its $26B HPS Corporate Lending Fund after investors requested $1.2B, about 9.3% of assets.

The fund paid $620M, but once it hit its 5% quarterly redemption cap, the rest of the requests were blocked. This mechanism is known as a redemption gate.

Private credit funds lend directly to companies at 8–12%, but these loans run 3–7 years and are not traded publicly. That creates a mismatch between liquid investor withdrawals and illiquid long-term loans.

The private credit market has grown to roughly $3T since banks pulled back after 2008.

With the labor market weakening and spending slowing, repayment risk rises. If investors start pulling capital at the same time, pressure can spread across the credit system.