Blackstone Inc.'s flagship private credit fund, BCRED, limited redemptions for the first time in its history. Investors had requested to withdraw 10% of their shares, but the fund only allowed redemptions of 5%. This move follows a previous quarter where BCRED, the largest fund of its kind with $79 billion in assets, took unusual measures, including senior executives using their own cash, to allow all 7.9% of requested withdrawals. The latest limitation highlights a broader trend of investor exodus from private credit funds.
Separately, Blackstone's publicly traded business development company, the Blackstone Secured Lending Fund, continued to report stress in its largest investment, software company Medallia Inc. The fund marked down its loan to Medallia to approximately 78 cents on the dollar in February 2026, a further reduction from 87 cents in June 2025 and 89 cents in the first quarter of 2025. This series of markdowns indicates ongoing concerns about the asset's performance.
Despite these challenges, Blackstone reported that redemption requests for BCRED had fallen "materially" at the start of the third quarter. In its second-quarter results for 2026, BCRED had total assets under management of $94.6 billion and a net asset value of $42.8 billion, delivering a gross return of 6.8% over the 12 months ending June 2026. Blackstone also attracted significant capital, with inflows into its global direct lending strategy reaching $13.3 billion during the quarter, including $1 billion for BCRED, and total assets under management for the Blackstone Secured Lending Fund reaching $16.6 billion as of March 2026. The firm's wider credit and insurance business deployed $12.7 billion of capital during the quarter.
