Private Credit Inflows Plunge as Trust Gap Deepens, Says Neuberger Executive

During a recent edition of Real Yield, Susan Kasser, who oversees private debt at Neuberger, articulated to host Scarlet Fu the stark contraction in capital inflows that private credit managers have experienced in the first quarter of 2026, a contraction that stands in stark contrast to the robust fundraising environment of the previous year, and she underscored that the aggregate amount of fresh capital attracted by these managers fell by nearly sixty percent relative to the same period a year earlier, a decline that she linked explicitly to a widening trust gap between investors and the private credit industry.

Compounding the fundraising shortfall, the sector is currently contending with redemption requests of an unprecedented magnitude, which have forced many funds to liquidate assets or tighten credit terms, thereby exposing the fragility of business models that depend on a steady stream of new commitments to sustain leverage and generate returns, and the confluence of dwindling inflows and aggressive withdrawals has prompted fund managers to reassess liquidity buffers, risk‑adjusted pricing, and the adequacy of their operational procedures, revealing that the systemic safeguards designed for more benign market conditions were ill‑suited to the present environment.

Observers might therefore conclude that the private credit market's reliance on a veneer of investor confidence, rather than demonstrable performance metrics, has become a liability that can no longer be obscured by the sector's historical resilience, a conclusion that implicitly critiques the regulatory oversight that has permitted such asymmetries to persist, and unless the industry institutes more transparent reporting standards and aligns incentive structures with long‑term capital preservation, the trust gap is likely to deepen further, ensuring that future fundraising cycles will be characterized by heightened skepticism and an ever‑more demanding scrutiny of private credit managers' risk management practices.

Published: April 25, 2026