Apollo caps private credit fund redemptions for third straight quarter

Apollo Global Management is restricting withdrawals from its private credit fund for the third consecutive quarter, as investors rush to pull cash from the US$1.8 trillion direct lending market. The fund, with $26 billion in assets, announced on September 22 that it would cap redemptions at 5% of outstanding shares after 14.7% of investors sought to withdraw their funds, according to a shareholder letter.

This represents a decrease from the 16.8% of investors who had requested withdrawals in the previous period. Apollo's experience aligns with that of its peers, including BlackRock and Cliffwater, which have also imposed limits on withdrawals from their private credit funds. A surge in requests to exit the market has disrupted the private credit sector in 2026, as investors pull cash due to concerns about loan quality and exposure to legacy software businesses.

The fund reported $200 million in gross inflows during the third quarter, with investors reinvesting dividends into new shares. After paying out $700 million to repurchase shares, Apollo anticipates net outflows of around $500 million, or 3% of net asset value. The fund has generated 8.2% in returns since its launch in 2022. Most of the redemption requests were from investors who had previously submitted requests that were not fully met.

Those who sought to redeem this year will see about 75% of their requested capital returned after repurchases, according to the letter. The fund stated it will continue working through outstanding repurchase requests, noting it has substantial liquidity sources and can add leverage modestly when appropriate.