A sharp contrast with peers! Oaktree Capital says it will fully meet 8.5% redemption requests, calling the current environment an adjustment rather than a crisis.

``` Oaktree Capital Announces It Will Fully Meet Redemption Requests from Its Retail Private Credit Fund, Standing in Sharp Contrast to Peers Such as BlackRock's HPS and Apollo, Who Maintain Redemption Caps as Industry Withdrawals Continue to Surge. On March 27, according to Bloomberg, Oaktree Capital Management is fully meeting redemption requests from its $7.7 billion retail private credit fund, allowing investors to redeem shares equivalent to 8.5% of the fund’s net asset value. Its parent company Brookfield will use about $80 million of its own funds to help meet these redemption requests. Oaktree stated in an investor letter that the company has always managed the fund’s assets and liabilities conservatively, focusing on liquidity reserves while seizing investment opportunities. This move sends an important signal to the private credit market. Against widespread pressure on retail private credit funds, Oaktree’s decision to fully redeem, rather than invoke the industry practice of a maximum 5% redemption cap per quarter, shows a significant divergence among top institutions in liquidity management strategies. Full Redemption: Divergence from Peer Strategies Private credit funds typically set a quarterly redemption cap of no more than 5% of net assets to prevent forced discounted sales of illiquid assets. In the face of the current redemption wave, institutions are adopting notably different approaches. BlackRock’s HPS Investment Partners, Apollo Global Management, and Ares Management have all chosen to implement the 5% redemption limit, stating that this is in the best interest of all investors. Oaktree, however, has opted to follow the path of Blackstone and Blue Owl Capital, striving to meet 100% of redemption requests. According to Bloomberg, earlier this month Blackstone used $250 million of its own funds, along with over twenty senior executives contributing an additional $150 million, to satisfy redemption requests equivalent to about 7.9% of its flagship private credit fund. Oaktree’s latest move is similar. Specifically, the fund will repurchase shares equivalent to 6.8% of its net asset value, while Brookfield will purchase another 1.7% from a single investor. Oaktree characterizes this as a “statement of support” for the strategy. Ample Liquidity Reserves, Proactively Lowering Software Loan Exposure In a shareholder letter, Oaktree disclosed that, as of March 23, the fund held $1.8 billion in cash and undrawn credit lines. The company noted that the fund always maintains underweight positions in areas with the weakest market discipline, including PIK (payment-in-kind) loans and annual recurring revenue loans. Since the beginning of this year, the fund has partially sold publicly traded loans and bonds, aiming both to reduce software sector exposure and to accumulate more cash reserves, positioning itself to increase investments during market dislocations. Meanwhile, Oaktree has cut the fund’s per-share dividend by 2 cents to 16 cents to promote the strategy’s “long-term sustainability.” The company stated that, after adjustment, the fund's annualized net distribution rate will still remain at 8.5%. Triple Risks Intertwined, Oaktree Judges "Adjustment, Not Crisis" Oaktree made clear in its letter that the current private credit market is simultaneously facing three separate risks: rising software loan default risk, a surge in redemption requests raising liquidity concerns, and commodity price shocks increasing stagflation probability. “We did not anticipate any of these risks entering 2026, just as we didn’t foresee COVID-19 in 2020,” Oaktree wrote, “But in both cases, we maintained low leverage and ample cash reserves to deal with market dislocations.” Nevertheless, Oaktree’s overall assessment of the current situation is cautious yet relatively optimistic. “We ultimately believe this environment represents an adjustment, not a crisis,” the letter says. This characterization could play a stabilizing role in investor sentiment and redemption pressures on similar funds. Risk Disclosure and Disclaimer The market has risks, and investments require caution. This article does not constitute personal investment advice, nor does it consider the particular investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are appropriate for their own circumstances. Investments made based on this article are at your own risk. ```