The chief executive of alternative asset manager Ares disclosed Wednesday that international investors were behind most withdrawal requests from the company’s private credit fund designed for wealthy clients.
Speaking at the Morgan Stanley U.S. Financials conference in New York, Michael Arougheti revealed specific details about the redemption activity.
“We had 11% redemption requests. It was from less than 5% of our investors. It was largely concentrated in small institutions and family offices, not in the U.S.,” Arougheti stated during his presentation.
The alternative asset manager had earlier described these withdrawal requests as originating from “select geographies” without providing additional specifics.
The disclosure comes as affluent investors withdrew more capital than they invested in private credit funds managed by various asset managers during the early months of this year. Market concerns centered on issues including transparency, lending practices, and questions about how technology firms that borrowed significantly from direct lenders would handle challenges posed by artificial intelligence developments.
Despite the withdrawal activity, Arougheti expressed optimism about the sector’s future prospects.
Arougheti indicated this situation provided him with “confidence that the markets will grow through this.”
