Pacific Investment Management Co. (PIMCO) is taking a cautious stance on private credit, with President Christian Stracke indicating the investment firm is avoiding much of the loan supply currently coming to market.
The process of working through weaker assets in the sector is likely to extend over several years, particularly as investors continue to withdraw capital, Stracke told Bloomberg in an interview. The $1.8 trillion private credit market is facing a critical liquidity test as redemption limits and bankruptcies are cracking investors’ confidence.
A considerable about of loans available in the private-credit market currently are “pretty bad” and are not priced at levels that are attractive for the firm, he added.
JPMorgan, BlackRock
As a result, JPMorgan Chase & Co. (NYSE:
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