Barings is the latest asset manager to limit redemptions in its private credit fund, capping withdrawals at 5% of shares. 

This decision was driven by investor requests to pull out 11.3% of shares in the first quarter, as revealed in a regulatory filing and reported by Reuters.

Non-traded funds like Barings Private Credit typically offer quarterly liquidity to investors, allowing them to redeem shares through tender offers, which are usually capped at 5%. 

In this instance, Barings agreed to buy back approximately 44.3% of the shares that investors tendered, based on a pro-rata calculation.

“The fund's liquidity framework is designed to protect the long-term interests of all shareholders.

By applying this approach consistently, we seek to balance near-term liquidity needs with prudent stewardship of capital for both exiting and remaining investors,” the fund stated in its shareholder letter.

This is the latest private credit firm to cap redemptions following turmoil in the market. Recently, banks and asset managers have issued warnings or restricted lending in their private credit portfolios during ripples in the market.

Ares Management (NYSE:ARES) announced it would limit withdrawals from its Ares Strategic Income Fund after facing a significant increase in redemption requests. The decision comes as the fund, which targets affluent investors, saw redemptions rise to 11.6% in the first quarter, prompting the firm to cap outflows at 5%.

JPMorgan Chase & Co. (NYSE:JPM) has started restricting lending to loans associated with software companies in its private credit funds, while Morgan Stanley (NYSE:MS) curbed redemptions after investors sought to withdraw nearly 11% of shares from its North Haven Private Income Fund.

BlackRock Inc (NYSE:BLK) limited withdrawals from its $26 billion HPS Corporate Lending Fund after redemption requests surged to 9.3% of the fund’s net asset value.

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