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      Morgan Stanley Restricts Withdrawals from $7 Billion Private Credit Fund for Third Consecutive Quarter

      Morgan Stanley has imposed a 5% cap on withdrawals from its North Haven Private Income Fund, which has approximately $7 billion in assets. This decision marks the third consecutive quarter that the firm has limited redemptions, as investor requests have significantly exceeded the fund's capacity to accommodate them. In the latest quarter, withdrawal requests reached 11.4% of shares, but the fund was only able to fulfill a fraction of those requests, honoring less than half of the total.

      In a shareholder letter dated September 18, 2026, Morgan Stanley revealed that in the previous quarter, investors had requested 11.6% in redemptions, receiving about 43% of their requested amounts. The trend has been consistent, with Q1 2026 seeing redemption requests of 10.9%, where approximately 45.8% were fulfilled, translating to around $169 million returned to investors. Despite having a liquidity buffer of over $2.2 billion in undrawn capacity and about $400 million in liquid loans as of May 31, 2026, the fund has struggled to meet the high demand for withdrawals.

      The challenges faced by Morgan Stanley are reflective of broader pressures in the private credit market, with other major firms such as Blackstone, Apollo, and BlackRock experiencing similar issues. Cliffwater, another investment manager, also limited redemptions in its fund to 7% during Q1 2026 after facing requests for 14%. As the industry navigates these liquidity challenges, the North Haven fund's net asset value has reportedly declined by an estimated $100 million to $169 million per quarter, factoring in new investments and subscriptions.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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