FOHF

This is the first time redemptions have exceeded the cap, so they’ve never paid out more than 5% historically.

28 years in the club. I have recommendations.

“You see, what is happening to BDCs is similar to the Bodyline tour because…”

New followers turning up for credit content and instead you get one of the world’s best bowlers ever. Ever.

when your nickname is Whispering Death and your opponents gave it to you, well that kinda says enough

Has anyone told him ‘no’ yet?

It may also just delay the problem. They won’t want to do this twice, and to do so could materially constrain their ability to manage the vehicle appropriately (they have to make statutory distributions, they may need follow on capital for deals, they may already have committed to deals).

You wouldn’t ask <insert name of multistrategy hedge fund here> to pay out more than their stated gates on a given quarter.

It’s not even a liquidity mismatch unless that’s between perception and reality.

Then they have not been appropriately communicated with or read the terms.

Welcome to “appropriate asset liability management”. There are a couple of funds in this category who have structured their underlying investments in such a way that they need new capital coming in consistently, but most are just out here having appropriate structures for the underlying assets.

You are not “limiting withdrawals” if you don’t pay out more than the threshold you established. If retail clients thought they were in a liquid vehicle this is a marketing issue.

BlackRock limits withdrawals as redemptions rattle private credit fund BlackRock said on Friday it has put limits on withdrawals from a flagship private credit fund after a surge in ​redemption requests, amid rising investor worries over the once red-hot asset ‌class.

HPS out here sticking to the terms they offered

www.reuters.com/business/bla...

“Never mind I’ll find someone who is a clear upgrade on you” didn’t scan though.

Controversial position is that the managers should have stuck to their guns on the 5% limit.

Nor today. It’s not an asset liability mismatch, you just don’t like the terms you signed up to. If you add 1) 5% quarterly redemptions and 2) required dividends you are quickly getting to a 20-30% annual payout from private BDCs.

Is this new issue HY spreads at issue or current spreads?

bsky.app/profile/fohf...

And that’s ok, because that’s the terms of the vehicle, and no they haven’t “thrown up the gates” (cc: the FT)

Yeah. They’ll still be sitting there just about distributing 5% a quarter in a year’s time.

And it will take a while.

It doesn’t have to sell its loans in the open market. You’ll find out about the problems in the old fashioned way. Slowly, as they can’t refinance.

Down to being completely ineffectual when any fine motor control was required.

At some point the FT will stop mischaracterising the Blue Owl liquidity situation. Today is not that day.

This is a car crash

That’s a long old bus ride…

See also high yield and levered loans. Total yield-based investing has been fun but the hangover will be painful.

-throws a firecracker into a bear den-

"You have to help there are inexplicably lots of angry bears rampaging around!"

My older sister might have taken out Ealing council.

FTR I feel vaguely guilty liking this post.