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Public Private Plus Private credit: a look behind the headlines

26 May 2026

In recent months, private credit has come under increased scrutiny but, despite recent negative headlines and late credit cycle dynamics, the long-term case for investing in private credit remains robust.

 

Three inter-related themes have driven headlines contributing to a heightened, and arguably overstated, sense of alarm: 

 

  • Idiosyncratic credit events interpreted as early signs of a broader rise in defaults. 
  • Renewed focus on software exposure, particularly the potential impact of AI on business models.
  • Questions around flows and liquidity mechanisms, including the use of redemption limits. 

 

Taken together, these factors have amplified investor concerns beyond what fundamentals suggest, obscuring meaningful differentiation within the market. 

 

In this paper, we look behind the headlines to assess what criticisms are justified and which appear overstated. We also consider how taking a measured approach to including private credit in a broader credit portfolio can offer useful diversification and deliver a robust investment proposition for today’s market environment and for the long term.

Read the full report
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