Moody's Clips Blue Owl's Wings, Slashes Rating To Negative Amid Rising Redemptions

Moody's Ratings has revised Blue Owl Capital's (NYSE:OWL) flagship private credit fund rating to negative, a sign of continued strain on the private credit space.

The firm cut Blue Owl Credit Income Corp's (OCIC) rating to negative from stable in response to "significantly higher-than-peer redemption requests in the first quarter," Moody's stated.

Last week, it was reported that Blue Owl Capital capped redemptions in both its funds at 5% after investors requested withdrawals of 22% and 41% in its private credit and technology-focused funds, respectively.

The firm attributed the above-average number of requests to “heightened market concerns around AI-related disruption to software companies.”

“We continue to observe a meaningful disconnect between the public dialogue on private credit and the underlying trends in our portfolio,” Blue Owl wrote in a letter to shareholders and reported by CNBC.

 Moody's noted that while Blue Owl kept net outflows contained during the first quarter, they expect to see "elevated redemptions to persist in the ...

Full story available on Benzinga.com