More than three dozen California legislators are calling for Gov. Gavin Newsom to exempt the state’s film and TV production incentive program from a recently approved cap on corporate tax credits, warning that without action it will be “significantly kneecapped.”
Though the state’s budget has already been approved, the legislators say a solution must be devised before the end of the year so that production companies do not lose the “full value of tax credits they earned in exchange for creating middle-class entertainment industry jobs,” according to a letter dated Friday and addressed to Newsom, State Senate President Pro Tempore Monique Limón and Assembly Speaker Robert Rivas.
“Tax credits earned for creating jobs in motion picture and television production are not the same as tax credits provided for research and development,” the letter states. The legislation “creates short-term budget savings by reneging on commitments made to the entertainment industry and the working families who depend upon it for their livelihoods.”
The letter comes shortly after Newsom signed his final state budget as California’s governor, a $351.7-billion spending plan that includes new limitations on corporate tax credits.
The budget includes a provision that restricts the maximum tax credit companies can claim in a given year to $5 million or 50% of a company’s tax state tax liability, whichever is greater.
Hollywood industry representatives had warned the governor’s office that the new restrictions could affect the state’s production incentive program, which was just bolstered last year to an annual cap of $750 million.
The film and TV industry in Southern California has struggled to rebound from the effects of the pandemic, the dual writers’ and actors’ strikes in 2023 and the exodus of production to other states and countries.
Members who voted for the budget bill had believed there was a carve-out for the film and TV tax credit program, said Assemblyman Rick Chavez Zbur (D-Los Angeles), chair of the Assembly Democratic Caucus.
“I don’t think that anyone understood what this cap was, what it did and that it effectively kneecapped and reverses the progress that we made last year,” Zbur, who co-authored last year’s bill, said in an interview. “We need to have people understand that these changes, which I think people believed were minor, are really significant and will result in significant job loss if we don’t fix them.”
The new changes to the state’s film and TV tax credit program, which included expanded eligibility for additional shows and films, came after intense lobbying from studios and industry workers, who argued that more funding was necessary to lure production back from other states and countries.
Last week, the California Film Commission said the expanded tax credit program was set to deliver $6.6 billion in direct production spending in-state and more than 34,000 cast and crew jobs across the 170 total film and TV shows that received production incentives this year.
Pickford made an uncertain start to the World Cup, at fault when he was beaten at his near post when DR Congo took the lead against England in Atlanta before captain Harry Kane’s two late goals saw them through.
In the pressure cooker of the Azteca, however, Pickford had his finest game for England, with two brilliant first-half saves from Mexico striker Raul Jimenez, followed by an outstanding display of penalty-area command in a frantic second period.
“It was a very brave display of goalkeeping,” said Robinson. “I really admired what he did out there in that second half and his two saves in the first half kept England in the game. They could have been out of it by half-time if it wasn’t for him.”
Pickford won widespread praise for the way he took charge of his penalty area, taking the initiative by coming for crosses and corners on a regular basis as England, down to 10 men after Jarell Quansah was sent off early in the second half, came under siege.
“He decided that he was going to stand up. He came for crosses, made decisions to go for balls, making life easier for his defenders because of how good he was.
“The easiest thing as a goalkeeper is to stay on your line because you don’t get criticised. If you stay on your line you can’t make a mistake, but he showed maturity and bravery.
“He showed the way his game has developed by coming off his line, making those decisions, making big bold calls. That’s where you see how much he has evolved.
“Jordan took it upon himself, punched the ball, caught the ball, made life easier for his defenders.
“He doesn’t mind what players are in front of him. It doesn’t faze him. He’s played with a different back four for most games, with the full-backs alternating and a change in central defence.
“The players know him and trust him. I think there is a good relationship there.”
And Pickford’s Mexico masterclass can bolster England’s confidence as they try to overcome the dangerous Norwegians and master striker Erling Haaland, who demonstrated their threat by beating Brazil 2-0 in the last 16.
“I think Jordan Pickford’s confidence will be at an all-time high and the team’s will be as well after their win against Mexico,” added Robinson.
“I questioned them on air when Thomas Tuchel went to a back five after 71 minutes. I was thinking I wasn’t sure they would hang on, and that would have been a stick he would have been beaten with.
“It did go right and Jordan Pickford was a big part of it going right.”
Doucefleur
U.S. consumer credit fell by $0.188B in May, compared with the consensus expecting a $17.5B increase and a $20.82B increase in April (revised from $20.73B), according to data released by the Federal Reserve on Wednesday.
Total consumer credit was essentially
A steep NAV drop and a federal probe trigger a high-level departure at BlackRock.
The private credit market’s roughest stretch in years has claimed its first senior leader at a major asset manager.
BlackRock’s Phil Tseng is in the process of leaving his post as CEO of the firm’s publicly traded business development company, according to Bloomberg News.
The move comes amid a brutal year for BlackRock TCP Capital Corp. The firm marked down its net asset value twice in 2026 — by 19% in January and another 5% in May. Meanwhile, federal prosecutors in Manhattan have been reportedly probing the fund and questioning executives as part of the inquiry.
Tseng, an acqui-hire from BlackRock’s 2018 acquisition of Tennenbaum Capital Partners, remains employed for now with no set departure timeline.
Tseng’s exit echoes a pattern that emerged last fall when two auto-related borrowers collapsed and rattled private lenders. Cleveland-based First Brands filed for Chapter 11 in September after off-balance-sheet financing obscured leverage levels beyond what lenders had underwritten. Founder and CEO Patrick James resigned as the bankruptcy unfolded.
That same month, subprime auto lender Tricolor Holdings began liquidating. Federal prosecutors later indicted founder and CEO Daniel Chu and chief operating officer David Goodgame, alleging the pair systematically misled lenders to keep credit lines open. Goodgame pleaded guilty in June to six counts, including bank fraud and conspiracy, and is now cooperating with prosecutors — a deal that could put him on the stand against Chu, who has pleaded not guilty. Chu had also abruptly resigned from Origin Bancorp’s board days before Tricolor’s implosion.
Industry executives have largely characterized the two collapses as isolated fraud cases rather than evidence of systemic rot. Blue Owl co-president Craig Packer told CNBC in October that the failures “weren’t private credit stories” at all.
BlackRock CEO Larry Fink struck a similarly confident tone. On an April earnings call, he told analysts that institutional demand for private credit was “accelerating.” Still, headlines around the sector aren’t reflecting what the firm’s own client and portfolio data showed.
Redemptions from business development companies, key lenders in the private credit market, are surging. Investors requested $20.8 billion in redemptions in the first quarter alone. In some cases, those redemptions exceeded the 5% cap set by BlackRock and its rivals: Apollo Global Management, Ares Management, Blackstone, Blue Owl Capital, and KKR.
Not all private credit funds appear troubled. Goldman Sachs’ private credit fund, for example, honored all redemption requests in Q2 because it reported relatively modest private credit fund redemption requests (3.2%). The same goes for Nuveen Churchill and Oaktree with withdrawals of 3.1% to 4.5%, respectively.
But with so many of the sector’s players posting losses, Tseng’s departure suggests the reckoning is reaching up the org chart.
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Elon Musk’s space and AI firm secured first-time ratings from Moody’s, Fitch and S&P Global on Thursday, a milestone that places its debt firmly in investment-grade territory and could allow it to borrow more cheaply as it funds a vast expansion.
The endorsements arrive less than a week after the company’s record IPO, which raised around $85.7 billion (€73.8bn) in the largest initial public offering in history.
Moody’s assigned SpaceX a Baa1 long-term issuer rating with a stable outlook. In its report, the agency pointed to the firm’s “exceptional franchise strength” as the world’s leading orbital launch provider and operator of Starlink, the largest low Earth orbit satellite broadband network.
The rating is also slightly higher than Tesla’s Baa3. Reacting to the news in a reply on social media, Elon Musk wrote: “Tesla’s credit rating is ridiculously low to be honest.”
According to Moody’s, Starlink has become SpaceX’s primary cash flow generator, underpinning improving scale, wider margins and a gradual shift away from more cyclical launch revenue.
Moody’s also set out the risks. It said the rating was constrained by the heavy execution and financial demands of SpaceX’s large-scale AI buildout, marked by high capital intensity, sustained negative free cash flow and an uncertain range of returns.
The agency highlighted the company’s dependence on the next-generation Starship V3 vehicle, warning that technical setbacks or delays could pressure long-term growth.
It further pointed to elevated governance risks tied to SpaceX’s controlled structure and concentrated voting power, which it said limit independent board oversight and leave the firm heavily reliant on a single individual, Elon Musk.
However, Moody’s still projects strong revenue and earnings growth through 2028, driven chiefly by Starlink, which counted 12 million subscribers as of early June, alongside an expected turning point in the AI division.
The agency cited recent third-party compute deals with Anthropic and Google worth a combined $75 billion (€65bn) as evidence of that potential.
As for the other credit agencies, Fitch issued a BBB+ long-term issuer default rating, also with a stable outlook, citing the company’s commanding lead in commercial launch, where it has delivered more than 80% of global mass to orbit since 2023.
Meanwhile, S&P Global assigned a BBB rating with a stable outlook, weighing the strength of the launch and connectivity businesses against the risks of the nascent AI segment and the company’s substantial capital needs.
The ratings did little to steady the stock on Thursday.
SpaceX closed at $185, down more than 18% from the high of $225.6 it reached on Tuesday, when its valuation briefly topped $3 trillion (€2.6tn).
The shares fell as low as $172 during the session before paring losses, as investors weighed whether the company’s lofty valuation had run too far.
The retreat has reshuffled SpaceX’s standing among the world’s corporate giants. The company now ranks once again as the sixth most valuable listed firm by market capitalisation, having given back some of the ground it gained earlier in the week.
On Tuesday, it had overtaken Amazon to claim fifth place, and at its intraday peak, it briefly leapfrogged Microsoft into fourth before this week’s slide pushed it back down.
Even after surrendering some of those gains, SpaceX sits among the most valuable companies on the planet just a week into its life as a public firm, and the investment-grade verdict from all three major agencies marks a notable shift in how financial markets judge a business that spent years operating as a privately funded rocket maker.
Credit markets shrug off geopolitical turmoil as investors seek yield, SocGen says
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Financial expert Laura Pomfret explained what the CCJ letters are and what to do about them(Image: BBC)
More than 270,000 people across England, Wales, and Northern Ireland have received letters through the post, according to a BBC expert – and those who ignore them could find themselves facing court action. Viewers of BBC Morning Live were recently warned about the thousands of letters connected to county court judgements that have been dispatched over the past 12 months.
Expert Laura Pomfret explained to viewers that a County Court Judgement (CCJ) is essentially a court order issued in England, Wales, and Northern Ireland when someone fails to repay a debt and the creditor pursues enforcement action. She noted it could come from a council, company, landlord or a private individual – and if left unpaid, it can appear on the person’s credit report.
She said: “I think that’s what a lot of people resonate with that they’ve heard of CCJs can be bad for your credit. They stay on your credit report for six years. It can impact you getting a mortgage, even getting um a rental property. Sometimes credit checks are done, even when getting a mobile phone contract.
“It’s definitely something to avoid if someone can avoid it, and worryingly, in the first quarter of this year, over 270,000 new CCJs were registered, and that’s 17.5% up on last year. So this is obviously showing that people are struggling and in the energy industry is something that you know it’s it’s getting bigger and bigger.” She explained that these are frequently issued to those falling behind on energy bills — with the latest Ofgem figures revealing debt standing at £4.5 billion — while Energy UK puts the figure even higher at £5.5 billion.
She added: “That’s like such a big bill that lots of people are pay and people pay every month clearly struggling with it. And interestingly as well, credit card transactions in February were up 6% versus last February whereas debit transactions were only up 1%. And that also shows, you know, that people are having to rely on credit for even the most basic of bills.”
Ms Pomfret noted that receiving a CCJ typically follows a series of threatening letters, meaning the householder will already be feeling anxious. She said: “Firstly, it is upsetting to receive a formal document like that. If you get that through the post, it’s got a court seal on it it’s very formal. It might have followed you, you know, debt demand letters with red writing all over, which is overwhelming.”
“Firstly don’t be overwhelmed is easy to say but don’t be alarmed like it’s just a formal process it’s essentially a document asking you asking you for money and so it if it comes through the post you it will tell you what you owe it’ll tell you how to pay it and it will also tell you the deadline by which to pay so you have a few options when you receive a CCJ.” She explained that the first option was to repay the debt – and if someone does so within a month, it could be removed from their credit file. She said: “After that, it stays on your report, but it says that you paid it. So, please make sure you prioritise paying it.”
It’s also possible to vary the terms of a CCJ, she noted, which involves approaching the court to attempt to alter the conditions of the judgement. “Another thing that you may be able to do is apply for what’s called breathing space. So this is formerly called in England and Wales the debt respite scheme. “What this does is it gives you space from creditors, including the CCJ, and maybe gives you time to make a plan to pay it back or speak to a debt advisor, which is super helpful. The last thing that you may be able to do is you may actually be able to get the judgment or CCJ set aside. or recalled if you believed um that it’s an error.””
She stressed that there would need to be a legitimate reason to apply for it to be set aside, including submitting evidence, primarily that the individual doesn’t owe the money or that it’s a mistake. She added: “Another reason is that you didn’t receive the original claim form. So before a CCJ is issued or a decree is issued, you will get a claim form put forward and there’s an opportunity to respond.
“So you could have, for example, the wrong address, it could have been sent somewhere else. You may not have received it. Now, the court’s not going to take kindly to just saying, ‘I didn’t receive it.’ It’s kind of like the dog ate my homework sometimes for some people, but you may genuinely not have done. So that could be an option. Ultimately, you’re going to need evidence, you’re going to have to fill in the correct forms. You may have to pay fees to get it set aside, but you know, in the long run, it may be worth doing tha if you don’t want it to damage your credit.”
To find the steps and court forms involved in asking a court to vary the terms of a CCJ or decree, such as requesting to pay in instalments, or even how to get a judgment cancelled, you can click on the links below.
For England, Wales and Northern Ireland you can click here.
For Scotland you can click here., external
There temporary protection from your creditors while you get debt advice and make a plan.
In England and Wales this is called Breathing Space, and you can find information on that by clicking here., external
In Scotland this is called a moratorium, and you can find more information on that here.
Despite investor fears, private credit is far from a meltdown because not all risks are the same.
The cracks in the private credit market appear to be widening.
Private credit is a significant alternative to syndicated bank loans as a source of corporate capital provided predominantly by private equity (PE) firms. The market is heavily involved in financing data center capacity, which is burgeoning along with the demand for artificial intelligence. Investors fear that the artificial intelligence capital spending boom poses a threat to the software industry and may be creating a market bubble that leaves private credit funds overly exposed.
Yet there are reasons to believe the potential damage to the private credit market remains manageable and contained.
This article appears in the May 2026 issue of Global Finance Magazine. .
To be sure, when auto parts seller First Brands announced its bankruptcy late last year, which was financed by a credit fund sponsored by investment bank Jefferies Group, it raised alarms in some quarters. Underscoring the opacity of private credit, which is largely unregulated, were allegations that First Brands had borrowed against the same receivables more than once. Meanwhile, defaults elsewhere in the credit sector hit a record high in 2025, according to Fitch Ratings, reaching a 9.2% rate, more than double the 3.6% recorded in 2023. Default rates this January continued upward, reaching 9.4% before slightly easing in February to 5.4%.
As the First Brands financing reveals, banks as well as PE firms are involved in private credit, either by financing investment funds sponsored by Ares Capital, Antares, Apollo, Blackstone, Blue Owl, and the like, or via funds of their own. With pension funds, insurance companies, and increasingly, individuals investing in private credit, law firm Quinn Emanuel warned in a March client memo that the trend may pose systemic risk, even though private credit is still a relatively small part of the overall loan market.
“The result is a transmission chain that runs from the technology companies, through private credit originators, to the regulated banks that lend to them, to the insurers and pension funds that invest alongside them, and potentially to the retirement accounts of ordinary Americans,” the memo’s authors warned.
Only a minority of small corporate borrowers are in trouble, and companies with EBITDA of $25 million or less experienced significantly higher default rates—15.8%—than larger companies in 2025. Healthcare and consumer companies have higher default rates. Fitch also notes that realized losses for first-lien lenders have been limited, with most cases resulting in full or high-percentage recoveries.
Notably, private credit default rates historically tend to run higher than those on broadly syndicated loans, a trend some observers attribute to more customized, and sometimes distressed, lending terms. The January uptick was largely driven by “distressed” exchanges and payment-in-kind (PIK) interest, according to Fitch.
Concerns are growing about PE funds exposed to software. Investors worry that AI will disrupt the software industry, leading to defaults within portfolios of private-credit loans to the sector. But most such funds are diversified, and even those that aren’t may not be as vulnerable to disruption by AI as investors fear. That’s because the large language models underpinning AI require application program interfaces to operate, so software may still be needed to facilitate the technology’s use.
“Implementing AI still requires significant effort to get it to work in a particular environment,” Alen Lin, senior director of North America corporates, technology, at Fitch Ratings, told audiences at a recent webinar held by the firm.
Of course, much depends on the type of application involved. As Fitch notes, companies producing software that is either deeply embedded in enterprise technology systems, leverages proprietary data, or operates in more regulated industries like health care and financial services could benefit from the development of AI. By contrast, those producing software for applications that aren’t so embedded, such as digital content creation or certain types of analytics and visualization tools, are more exposed to AI disruption.
Even if the AI bubble bursts, that risk is unlikely to evaporate, Lyle Margolis, senior director in Fitch’s corporates group, where he manages its private credit business, said in an interview with Global Finance. “AI is here to stay and is going to be disruptive to certain segments of the software market,” he says.
Yet the risks may be overstated. Whether measured by leverage, interest coverage, or EBITDA, “the trends in the software sector have actually been somewhat positive,” he noted. Refinancing risk for the sector is relatively benign. And data-center build-out provides one of several “significant tailwinds” for private credit in the software sector, added Dafina Dunmore, Fitch’s senior director of North American non-bank financial institutions.
Another mitigating factor: Redemption risk, which can see large outflows of capital. However, it is limited largely to business development companies (BDCs), a more liquid, retail-oriented variety of private-credit investment vehicle. Blue Owl, for example, recently blocked redemptions at one of its BDCs and liquidated some others. And the $33 billion Cliffwater Corporate Lending Fund, the largest US private-credit interval received redemption requests on 14%.
Although defaults are rising for these portfolios, redemption risk isn’t a problem for most credit funds, because investors are locked in until maturity. In addition, stress is concentrated in direct lending: corporate loans that fund working capital and growth.
To be sure, many such risks may be hidden, given private credit’s opacity. Blue Owl’s exposure to software loans, among the highest in the industry, is roughly twice as extensive as its public filings indicate, according to a recent analysis by the Wall Street Journal. The paper also found other PE firms whose credit funds exhibit software exposure exceeding what’s publicly disclosed include Blackstone, Ares, and Apollo.
Investor worries may exacerbate Blue Owl’s redemption woes since its data center financing deals involve accounting practices that obscure the risk involved. The main source of concern is likely Blue Owl’s $27.3 billion financing of Meta’s Hyperion data center in Louisiana.
Yet, S&P rates the bond backing the deal, called Beignet, as Meta’s obligation, reflecting that it bears the risk of default. Indeed, investors seem to like that cash-rich Meta stands behind Beignet. The bond was recently spread over a bond financing the CoreWeave data center, which isn’t backed by the hyperscaler.
Still, some wonder if the risks are adequately priced into these issues.
Quinn Emanuel warns that the vagaries of Meta’s accounting treatment may lead to litigation between the parties over who bears the loss if AI fails to meet expectations and Meta chooses not to renew the lease. Blue Owl finances an Oracle data center in similar fashion, but that bond is trading at a discount to Meta’s, partly because Oracle doesn’t back it and partly because the ultimate tenant is less financially stable OpenAI.
“When we rate data centers, to some extent we look at the credit quality of the ultimate tenant,” says Victor Leung, vice president for project finance at ratings firm DBRS Morningstar.
This type of complexity led Quinn Emanuel to warn in its March 13 memo that, “the AI data center buildout—projected to require $5.2 trillion in infrastructure investment by decade’s end—has spawned complex financing structures that are generating significant litigation risk.”
Mark Koziel, CEO of the International Association of International Certified Professional Accountants and president-CEO of the American Institute of CPAs, says he would raise the issue of current accounting rules for such financing arrangements at an upcoming meeting with the Financial Accounting Standards Board. Also last month, the US Department of the Treasury said it would meet with industry and investor representatives to discuss private credit’s potential risk to the financial system.
Thus far, warnings of a private credit meltdown seem overstated.
Credit funds focused on asset-backed finance (ABF), which is based on the value of a borrower’s assets and is the fastest-growing sector in the market, are relatively immune to stress, thanks to their self-liquidating feature. In contrast to direct loans, principal on asset-backed financings is paid back during the life of the loan. As a result, ABF funds don’t face the same refinancing risk as direct lenders.
Sponsors of direct lending funds “don’t have the benefit of those cash flows directed to pay down the loans,” notes Fitch’s Margolies.
Apart from First Brands’ receivables deal with Jefferies, the ABF segment has yet to be fully tested. But a test may soon be underway: Beignet is also asset-backed. Or sort of.
Debt principal remains outstanding at each renewal point, so it isn’t completely self-amortizing. As a result, DBRS Morningstar’s Leung notes, “you face a risk that your facility will lose its source of revenue.” Hence, Meta’s guarantee that it will make up any loss facing investors if it fails to renew the lease and the facility’s residual value falls below a certain threshold.
That scenario is not far-fetched, Quinn Emanuel warns, noting that it’s expensive to convert an AI data center to general-purpose cloud computing or other uses: “If demand for AI computing contracts, these facilities may function as stranded assets with limited alternative use and depressed liquidation value.”
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Private Credit Suntera’s Von Bevern on the ‘Speed’ Advantage of Private Credit
Michael Von Bevern of Suntera breaks down how private credit lenders are faster and act more like business partners than banks in a tightening global market.
As traditional banks continue to retreat from risk, private credit is stepping in to provide the speed and execution that entrepreneurs desire. Global Finance spoke with Michael Von Bevern, Global Head of Funds at Suntera Global, about why this “unregulated” sector has become a permanent fixture in the funding landscape.
Global Finance: What are the benefits of being a private credit borrower?
Michael Von Bevern: The big benefit is speed. It can be relatively simplistic, depending on what type of borrowing you’re going for. In a direct-lending situation, like a senior term loan, it is usually simple because your risk profile is clear. For anything less senior, such as mezzanine or subordinated debt, the advantage is that it provides capital without diluting ownership. That’s important for entrepreneurs. They just need cash flow to grow and don’t necessarily want to give up equity. And they don’t want to be taken to the cleaners for raising equity. In those cases, mezzanine or subordinated debt can be a really effective solution.
In our business, we see a lot of NAV (Net Asset Value) lending, where a fund’s assets serve as collateral. This helps borrowers boost returns and navigate tricky markets, especially when raising equity is difficult. I also see a lot of action in specialty finance, or the asset-based lending space. The borrower is unlocking liquidity at usually more favorable rates than going to banks.
GF: Are banks really that cumbersome?
Von Bevern: Well, they don’t take risks. That’s not what they do. They bet on sure things, whereas in our industry, we fill the gap for high-growth companies seeking custom, quick solutions. We have a lender at Suntera — Carlyle Group. They’re extremely helpful. It’s like having a business partner.
GF: You wouldn’t get extra assistance with, say, JPMorgan Chase or Morgan Stanley?
Von Bevern: We bank with JPMorgan here in the U.S. Don’t get me wrong — I love JPMorgan. But, they’re not the risk-takers. If you need speed, if you need execution quickly, banks aren’t known for that. Specialty lenders — whether focused on a particular sector or type of credit — can move much faster than a bank. That speed can make the difference in whether a deal gets done. There’s a lot of competition out there, especially with the IPO market drying up. Finding ways to create liquidity and still grow your company is critical. At the end of the day, banks are regulated. These lenders aren’t, so they just view credit differently than your average fund lender.
GF: Is the unregulated party going to end soon?
Von Bevern: I don’t think so.
GF: Why not?
Von Bevern: I’ve been doing this for 20 years, and people have been talking about regulating private credit the whole time. I just don’t see it happening. If you did regulate it, you’d basically be regulating private equity and venture capital, too. What makes it work is that there are highly skilled, disciplined people in this industry who can lend responsibly while helping companies achieve their goals — whether it’s M&A, expansion, or growth. I can’t see regulation coming in and dampening that.
GF: How do you pay back a private credit lender like Ares, Blackstone, KKR, or Carlyle?
Von Bevern: I can’t speak to the Carlyle loan specifically, but in general, we see lots of different loan agreements as a fund admin and loan agent. The key thing is flexibility—these agreements are designed for repayment, but they give you options: payment-in-kind (PIK) interest option, rollovers, and adjustable-to-fixed contracts. They’re structured to support your growth while giving you room to navigate the business.
GF: So, with Suntera and Carlyle, is there someone on the ground at Suntera who can offer expertise or perspective, given how sector-specific it is?
Von Bevern: I can’t speak to Suntera and Carlyle, but large private credit lenders work across multiple industries and verticals. That means when you’re in a specific sector and need liquidity, they bring a wealth of experience from similar companies. They can act almost like a business partner — advising on how you use the proceeds, what your expected returns might be, and even on covenants in loan agreements.
Over the years, I’ve seen lenders in areas like recycling, renewables, and reusability not only provide capital but also offer extensive guidance about the business itself. It’s similar to what private equity would provide — but without the dilution.
GF: Wouldn’t these companies get money from a traditional bank if they could? And are these companies already a credit risk?
Von Bevern: There’s some risk in every loan. The less risky borrowers are usually the ones banks handle. Banks set strict guardrails and count on repayment. Private credit, on the other hand, often funds the next level down or borrowers that need speed of execution that banks can’t offer. The risk depends on the loan structure — whether it’s collateralized or uncollateralized, senior or mezzanine — and is managed through interest rates, covenants, and other terms.
Looking ahead, we’re approaching a refinancing cycle that will make the embedded risk in today’s market clearer — probably by the end of 2027. Even so, defaults remain rare, and most borrowers are likely to refinance without issue. Of course, there will always be cases, like Blue Owl, that attract attention, but those don’t indicate a broad crisis.
GF: U.S. small business insolvency filings jumped 67% year over year. Many point to inflation, geopolitical instability, and tightening credit as key factors.
Von Bevern: A few years ago, when interest rates were historically low, it was easier to match lenders with portfolio companies in a way that worked for both sides. Today, with interest rates much higher, we’re entering a cyclical period that naturally creates stress for these businesses. Your stat isn’t surprising, but structurally, the market remains sound. It’s also hard to know how many of these insolvencies were directly due to loans or credit constraints.
GF: The European Central Bank’s fourth-quarter data shows euro-area banks are tightening credit standards. Are you seeing private credit growth globally as a result?
Von Bevern: The expansion of private credit is definitely a global trend. We operate in the U.K., the Channel Islands, the U.S., Singapore, Hong Kong, the Bahamas, and other markets, and the trends are similar across regions — interest rates have risen everywhere. Even with higher rates, defaults haven’t spiked as some might have expected. Lending today is often collateralized, not just unsecured, and large funds, like BlackRock’s $20 billion credit fund, are expanding the pool of borrowers, which naturally introduces a wider spectrum of risk — but that’s manageable. Competition among private lenders has increased significantly, thanks to abundant dry powder and a mature, experienced market. Looking ahead, the refinancing cycle over the next year or two will be interesting to watch, but I don’t see it as a systemic problem.
GF: Should ETFs, retirement accounts, and pension funds incorporate private credit companies?
Von Bevern: They already are. Private credit exchange-traded funds (ETFs) are definitely among the fastest-growing segments of the business. And they can be either directly with the lender or the stock of a company that does a lot of private credit lending. So it’s a sort of direct and indirect way to get into the ETF part of it.
GF: So you’re clearly bullish about private credit. Is there anything you’re bearish about?
Von Bevern: Going into 2026, I expected it to be a strong fundraising year. There’s a lot of dry powder, and many managers still have to fully invest the funds they raised in prior years before starting new ones. Overall, that made me bullish.
What concerns me is emerging managers. With so much dry powder flowing to established names, it’s harder for new managers to raise funds. It’s going to the sort of household names. Intense selectivity and abundant opportunities are making it harder for emerging managers in our space to gain attention. It’s not that they can’t be successful; there just won’t be that many of them. I’ve worked with hundreds of emerging managers over my career, and many struggle to get off the ground even with strong pedigrees.
Emerging managers often provide more specialized attention to portfolio companies, which can translate into better returns. If this segment struggles, it could constrain that part of the alternatives market. But hopefully this too will pass.
Editor’s note: This interview has been edited for length and clarity.