BlackRock Imposes Withdrawal Limits on $26B Credit Fund Amid Liquidity Strain
BlackRock has restricted redemptions from its $26 billion HPS Corporate Lending Fund after investor withdrawal requests surged to 9.3% of assets—nearly double the quarterly 5% limit. The asset manager approved only $620 million of the $1.2 billion requested, leaving half of investors unable to exit fully. The fund’s semi-liquid structure, which holds hard-to-sell private credit assets, forced the use of a redemption gate mechanism.
The move has sent ripples through global markets, spotlighting liquidity risks in the booming private credit sector. Shares of BlackRock dipped under pressure, while rivals like Blackstone and KKR face heightened scrutiny. Private credit funds, increasingly popular for their yield premiums, now confront existential questions about their ability to handle stress scenarios without traditional banking safeguards.
