Major banks and independent advisers have earned over $2 billion in fees from private credit funds, but rising redemption requests and asset valuation concerns signal a potential turning point in the sector’s growth and profitability.
Wealth advisers at major banks and independent brokerages have collected more than $2 billion in fees by steering clients into private credit and other semi-liquid private funds, even as some retail investors in the US begin to pull back from the sector.
A Financial Times analysis of regulatory filings, echoed by Private Banker International, shows that the biggest beneficiaries include large names such as Morgan Stanley, UBS and Bank of America Merrill Lynch, alongside independent wealth managers. The money flowed from a boom in so-called evergreen funds, which allow investors to add and withdraw capital at set intervals and became especially attractive during years of strong markets and intense demand for diversification.
That expansion is now under pressure. In the first quarter of 2026, redemption requests at major private credit groups including Apollo Global Management, Ares Management, Blackstone, Blue Owl and KKR rose to almost $21 billion, according to the FT’s analysis. Concerns are mounting over asset valuations, underwriting standards and whether money was deployed too freely, particularly into sectors such as software that face disruption from artificial intelligence.
Blue Owl Capital has already been forced to restrict withdrawals from two of its flagship private credit funds after an unusually high level of redemption requests. The shift marks a sharp reversal from the recent years in which semi-liquid products became a reliable and lucrative source of recurring fees for both asset managers and the advisers selling them.
Blackstone has been the largest payer of management fees and commissions in the segment, helped by its real estate fund BREIT and its private lending vehicle Bcred. Together, those funds have attracted more than $100 billion in net assets since 2020, and last year paid advisers a combined $280 million in fees, according to financial data cited by the FT. Blackstone also increased the ceiling on the fees BREIT can pay, raising it from 8.75 per cent to 10 per cent of gross capital raised.
Some advisers argue they were simply meeting client demand for access to higher-yielding private markets. Morgan Stanley has said in its 2026 outlook that private credit can still benefit from a shallow rate-cutting cycle and from a potentially “higher for longer” M&A environment. The firm has also described the market as one with scaling advantages and steady demand from both retail and institutional investors.
Still, critics say the incentives are hard to ignore. Shang Chou, co-founder of the multi-family office Dishmi Capital, told the FT that wealth advisers are caught in a structure that pushes them towards these products. Banks, for their part, insist their advisers are bound by fiduciary duties to recommend suitable investments and are not driven by commissions alone.
The tension reflects a wider reassessment of private credit, a market that had been sold as a way to capture yield, lower correlation with public markets and the illiquidity premium associated with non-traded assets. Now, as redemption pressures build and confidence wavers, the same products that helped turbocharge fee income for advisers are becoming a source of concern for the investors who bought them.
- https://www.ilfattoquotidiano.it/2026/04/19/credito-privato-commissioni-advisor-rischio-notizie/8360064/ – Please view link – unable to able to access data
- https://www.privatebankerinternational.com/news/private-funds-servicing-fees/ – An analysis by Private Banker International reveals that 16 semi-liquid private funds, including those managed by Blackstone, Blue Owl, Apollo, and KKR, have generated over $2 billion in servicing fees for wealth advisers since 2017. The report highlights how major brokerages and banks, such as Morgan Stanley, UBS, and Bank of America Merrill Lynch, along with independent wealth managers, have benefited from the surge in private funds. These evergreen vehicles, which allow investors to add and withdraw money at set intervals, gained popularity over the past five years amid strong markets and diversification demand.
- https://www.morganstanley.com/im/en-us/financial-professional/insights/outlooks/private-credit-2026-outlook.html – Morgan Stanley’s ‘Private Credit 2026 Outlook’ discusses the scaling advantages in a tight market, noting that investor demand remains stable across individual and institutional channels. The report suggests that private credit can perform well in a shallow rate cut environment that spurs a credit quality recovery. It also highlights the potential for a ‘higher for longer’ M&A cycle to shift supply and demand in favour of private credit lenders more quickly than industry observers appreciate.
- https://newsroom.bankofamerica.com/content/newsroom/press-releases/2025/09/merrill-and-bank-of-america-private-bank-launch-new-alternative-.html – In September 2025, Merrill Wealth Management and Bank of America Private Bank launched the Alts Expanded Access Program, a new private market program available to ultra-high-net-worth clients with a net worth of $50 million or more. The program is designed to complement the investment options available through Merrill’s and Bank of America Private Bank’s core Alternative Investments platform, offering qualified investors avenues to build an expanded allocation to alternatives as part of a diversified portfolio.
- https://www.financial-planning.com/news/ubs-morgan-stanley-see-risks-and-benefits-to-private-credit – Financial Planning reports that both UBS and Morgan Stanley acknowledge the risks and benefits associated with private credit. UBS’s Scansaroli highlighted that private loans often come with floating interest rates, helping ensure their yields stay ahead of inflation. However, he also noted that private credit comes with a different set of risks, and investors should be aware of these before investing.
- https://www.investmentnews.com/wirehouses/private-credit-is-having-its-big-boy-moment-according-to-morgan-stanleys-ceo/266160 – InvestmentNews reports that Morgan Stanley’s CEO, Ted Pick, stated that private credit is having its ‘Big Boy moment.’ The article discusses how financial advisors and the firms they work for are moving away from private credit funds and non-traded business development companies. Sales of illiquid and non-traded BDCs have plummeted, with investors seeking to redeem shares at levels exceeding a fund’s standard limit.
- https://www.morganstanley.com/ideas/private-credit-outlook-considerations – Morgan Stanley’s ‘Private Credit Outlook: Estimated $5 Trillion Market by 2029’ discusses the illiquidity premium associated with private credit, noting that it may provide a yield spread above public corporate bonds to compensate for the non-tradeable nature of the investments. The report also highlights that private credit has demonstrated lower loss rates relative to public credit over time and has been less correlated with public markets than other asset classes, such as equities and bonds.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The article was published on April 19, 2026, and reports on a Financial Times analysis of regulatory filings. Similar reports from Private Banker International and Financial Advisor IQ were published on April 20, 2026, indicating that the information is recent and not recycled. ([privatebankerinternational.com](https://www.privatebankerinternational.com/news/private-funds-servicing-fees/?utm_source=openai))
Quotes check
Score:
7
Notes:
The article includes direct quotes from Shang Chou, co-founder of Dishmi Capital, and Bob Elliott, co-founder of Unlimited Funds. These quotes are also present in the Private Banker International article, suggesting they may have been sourced from the same Financial Times analysis. ([privatebankerinternational.com](https://www.privatebankerinternational.com/news/private-funds-servicing-fees/?utm_source=openai)) However, the exact origin of the quotes is not independently verified. The lack of direct links to the Financial Times analysis raises concerns about the verifiability of these quotes.
Source reliability
Score:
6
Notes:
The article is from Il Fatto Quotidiano, an Italian publication. While it cites a Financial Times analysis, the lack of direct access to the original Financial Times article and the presence of similar reports from other sources suggest potential issues with source independence. The reliance on a single source for critical information raises concerns about the reliability of the content.
Plausibility check
Score:
8
Notes:
The claims about wealth advisers earning over $2 billion in fees from private capital are plausible and align with recent reports from other reputable sources. However, the article lacks specific details and direct links to the original Financial Times analysis, making it difficult to fully verify the accuracy of the claims.
Overall assessment
Verdict (FAIL, OPEN, PASS): FAIL
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The article reports on wealth advisers earning over $2 billion in fees from private capital, citing a Financial Times analysis. However, the lack of direct access to the original Financial Times article, reliance on a single source, and unverified quotes raise significant concerns about the accuracy and reliability of the information. Given these issues, the content cannot be fully verified, and publishing it carries potential risks.