Oaktree BDC Chief Sees ‘Excessive Risk-Taking’ in Private Credit

Software-sector weakness, liquidity concerns and a series of bad underwriting vintages are all widening the moat between public and non-traded private credit vehicles, according to Oaktree Capital Management’s Armen Panossian.

As rates came down following the pandemic, tremendous amounts of capital flowed into credit markets, and private lending in particular. For retail-focused vehicles, like business development companies, managers sought to deploy cash quickly and selection standards suffered, according to the co-chief executive officer of Oaktree.