Key Takeaways
- • Glendon Capital Management has accused private credit lenders, including Blue Owl, of obscuring portfolio weaknesses, according to a Financial Times report cited by Reuters on March 12.
- • Glendon said Blue Owl and many rivals had "misrepresented" loss rates and are holding "larger losses than reported," based on a presentation cited by the FT.
- • Glendon criticized Blue Owl's valuations of loans in Blue Owl Capital Corporation, one of its largest funds, arguing that marks set at the end of 2025 sit above current public trading prices for debt of the same companies.
- • Reuters could not immediately verify the report; Blue Owl did not immediately respond to a request for comment.
- • The claims come amid broader stress in the roughly $2 trillion private credit market, including Morgan Stanley's redemption limits and JPMorgan's markdowns on loans to private credit funds.
Summary
Investment firm Glendon Capital Management has said that private credit lenders, including Blue Owl Capital, are obscuring weaknesses in their portfolios and that a sharp correction in debt markets is approaching, the Financial Times reported on Thursday, March 12, in a story Reuters carried. The FT said Glendon made its claims in a presentation, asserting that private credit funds managed by Blue Owl and many of its rivals had "misrepresented" loss rates and were holding "larger losses than reported."
The criticism centers on Blue Owl's valuation of loans held by Blue Owl Capital Corporation, one of the firm's largest funds. According to the FT, Blue Owl's marks on loans made at the end of 2025 were higher than current public trading prices for debt tied to the same companies, which gave Glendon "concerns about the true valuation" of the portfolio.
The report arrives as investors brace for further negative news following a string of credit issues in recent weeks that have drawn scrutiny to the roughly $2 trillion private credit market. Blue Owl, which managed more than $300 billion in assets as of December 31, has faced its own difficulties since late last year, when it moved to limit withdrawals from a fund. Last month, the firm also worried investors by selling shares of other alternative asset managers.
The broader sector showed further strain on Wednesday, when Morgan Stanley limited redemptions at one of its private credit funds and JPMorgan Chase reduced the value of some loans extended to private credit funds. Reuters could not immediately verify the Glendon claims, and Blue Owl did not immediately respond to a request for comment outside regular business hours. A Glendon representative did not respond to a request for comment on LinkedIn.
The criticism centers on Blue Owl's valuation of loans held by Blue Owl Capital Corporation, one of the firm's largest funds. According to the FT, Blue Owl's marks on loans made at the end of 2025 were higher than current public trading prices for debt tied to the same companies, which gave Glendon "concerns about the true valuation" of the portfolio.
The report arrives as investors brace for further negative news following a string of credit issues in recent weeks that have drawn scrutiny to the roughly $2 trillion private credit market. Blue Owl, which managed more than $300 billion in assets as of December 31, has faced its own difficulties since late last year, when it moved to limit withdrawals from a fund. Last month, the firm also worried investors by selling shares of other alternative asset managers.
The broader sector showed further strain on Wednesday, when Morgan Stanley limited redemptions at one of its private credit funds and JPMorgan Chase reduced the value of some loans extended to private credit funds. Reuters could not immediately verify the Glendon claims, and Blue Owl did not immediately respond to a request for comment outside regular business hours. A Glendon representative did not respond to a request for comment on LinkedIn.
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