Marc Rowan, chief executive of Apollo Global Management Inc., cautioned that the private credit sector is headed for a prolonged period of consolidation as the industry contends with growing loan defaults to software companies.
Speaking at Bloomberg Invest in New York on Tuesday, Rowan said the disruption will not be fleeting and stressed the role of underwriting and risk management in determining who weathers the stress.
"This will be a shakeout - I don't think it is going to be short term," Rowan said. "It was foreseeable. It was predictable. And all you can do is have been a good underwriter, a good risk manager, have done a small number of stupid things."
Rowan highlighted a recent series of failures in bank loan portfolios as symptomatic of wider pressures in credit markets. The comments come as certain business development companies have experienced redemptions in recent weeks amid investor concern.
Large alternative asset managers that provide private credit vehicles for individual investors have reported elevated requests to withdraw capital from those funds. Firms specifically named as having faced a spike in such requests include Blackstone Inc., Ares Management Corp., and Blue Owl Capital Inc.
The developments are occurring alongside a notable move in Apollo's own stock price. Apollo's shares have fallen roughly 30% so far in 2026.
Rowan linked the industry tensions to underwriting choices and risk management practices rather than treating the problems as isolated or short-lived. He suggested that firms that maintained disciplined origination and avoided significant missteps would be better positioned during the anticipated shakeout.
Investors and market participants watching private credit and business development companies face uncertainty about the scale and duration of withdrawals and defaults. The combination of higher default activity in certain borrower segments, such as software companies, and redemption pressure on retail-oriented credit funds adds to that uncertainty.
For managers and investors in the private credit space, the near-term landscape will be shaped by loan performance, redemption flows, and the ability of firms to demonstrate strong underwriting and portfolio oversight.