Call this an editorial on an editorial. On Wednesday, the Financial Times' editorial board warned that “private credit risks remain at large,” reaching for Jamie Dimon's cockroach line and the year-old collapses of First Brands and Tricolor to argue that last autumn's scare wasn't a one-off. Near the bottom of the piece, offered almost in passing as evidence, sits this: Ares Management “scaled down a billion-dollar private credit continuation vehicle this month by more than half when investors pushed back on valuations.” The word “secondaries” does not appear anywhere in the editorial. It should have, because that one sentence describes the only part of this entire story where somebody's opinion about a loan's value actually had to survive contact with a buyer who didn't have to say yes.
The anniversary the FT is marking
The hook is timing: it's been almost a year since First Brands and Tricolor filed for bankruptcy, and Jamie Dimon's “when you see one cockroach, there are probably more” became the epigraph for a year of hand-wringing over the roughly $2tn private credit market. The FT's verdict now: last summer's scare “was not a blip.” Direct lending is under real strain, non-accrual loans at the 20 largest public BDCs hit their highest level since 2017 this quarter, even as investment-grade asset-backed lending holds up fine..
The rest of the warning, briefly
The editorial’s other worry lines are worth flagging even though they sit outside secondaries: circular ownership between private capital firms and the life insurers they’ve increasingly bought or founded to fund private credit with policyholder premiums, overseen by state rather than federal regulators, with a federal investigation now open into one such structure built by Mark Walter; Blue Owl’s flagship private credit arm posting its slowest fundraising pace in three years this summer after a stretch of heavy withdrawal requests; and a global “bond glut” pushing market rates up and contributing to a recent sell-off. All real. None of it is where the story gets a number attached to it, that’s the Ares sentence.
The sentence that matters
Strip away the FT’s framing and what actually happened is this: Ares went to raise a continuation vehicle to move a slice of its own aging private credit book (older loans, harder to exit) into a new fund, at a fair market value somewhere in the region of €700m to €1bn depending on which account you read (9fin and the FT’s own reporting differ slightly on the exact figures, though both describe the same deal and the same rough magnitude). Prospective buyers looked at Ares’s marks and wouldn’t pay them. Rather than accept the deeper discount the market was demanding, Ares simply shrank the deal: to somewhere between €350m and €400m, roughly half of where it started, with fewer loans transferring across.
“One of the rare moments when private credit marks face real-market testing.”
9fin, reporting on the Ares scale-down, 7 August 2026
That framing is exactly right, and it’s the reason this belongs at the center of the FT’s story rather than in a supporting clause. A markdown is one firm’s opinion about what its own loan is worth, checked by nobody with money on the other side of the trade. A continuation vehicle is different: it’s the one moment in private credit where an outside buyer, with every incentive to lowball and no obligation to be polite about it, has to put an actual bid on the table. Secondaries is, structurally, the private credit industry’s only real price-discovery mechanism; and this month it returned a number nobody at Ares wanted to hear.
Same firm, opposite outcome
Here’s the detail that turns this from an anecdote into a market signal: Ares Credit Secondaries, the buy-side arm of the same firm, led the €2.5bn Arcmont private credit continuation vehicle earlier this year, and that deal closed oversubscribed, priced at a nominal premium to par, with Ares syndicating pieces out to other investors. Same house. Same asset class. One side of the building got a clean, strong close; the other got told to cut the deal in half.
That’s market bifurcation stated as plainly as it gets. It isn’t that credit secondaries pricing is soft across the board, headline numbers on the best deals (Audax at $1bn led by Pantheon, Arcmont at €2.5bn led by Ares, TPG Twin Brook at $3bn led by Coller) have all closed at nominal premiums to par over the past year. It’s that whose book it is, and how strong the relationship and the underlying assets are, now decides which side of the line a deal lands on.
“Attractive pricing and the most complex, differentiated deals still go to platforms with the deepest GP relationships.”
— Rakesh Jain, Pantheon’s global head of private credit
It also lines up with what EQT’s new global chair, Jean Salata, said on Bloomberg TV the same week, explaining why EQT is re-entering credit for the first time since selling its own credit business in 2020 — via Coller Capital’s credit secondaries book, not a new lending platform. “There’s more sellers than buyers,” he said of the current dislocation, calling it “excess return potential... some alpha opportunities there,” and a “first window, first look at what’s happening in the credit markets.” Ares having to cut its own deal in half is what that dislocation looks like up close.
This is happening inside the fastest-growing corner of secondaries
None of this is occurring in a quiet market. In the same three-week stretch as the Ares scale-down, Willow Tree Credit Partners closed a $730m credit continuation vehicle led by HarbourVest; Bridgepoint began exploring a roughly $1.15bn private credit secondaries sale; and Jefferies Credit Partners started marketing a €1bn vehicle to move its own loan book off balance sheet. Evercore’s H1 2026 review already has private credit secondaries volume at $20bn for the half (more than all of FY2025) with $31bn of dry powder sitting behind it. Jefferies’ own research puts the segment’s volume compounding at 70%+ a year since 2023; Coller Capital’s Michael Schad is calling 2026 a likely record year, with the house view putting the market at $40bn by 2027. Across the broader manager-led secondaries market, credit’s share of volume jumped from 5% to 11% in a single year.
Two of the biggest platform acquisitions of 2026 are direct bets on this exact mechanism scaling further: EQT’s deal for Coller Capital and Lazard’s pending acquisition of Campbell Lutyens both explicitly cite credit secondaries as strategic rationale, not an afterthought. The smart money isn’t just watching the dislocation the FT is worried about, it’s buying the toll booth.
What hasn’t shown up yet
The one number that should temper any tidy narrative: BDC redemption requests are up roughly sixfold since the third quarter of 2025, per Evercore, but hardly any of that pressure has actually converted into secondary-market volume so far; Cox Capital’s tender offer amounted to just 0.1% of combined BDC NAV. The release valve everyone expects to open hasn’t fully opened yet. Whether it does, and whether more of it clears through vehicles that behave like Ares’s cut-in-half deal rather than Arcmont’s oversubscribed one, is the next thing worth watching.
The FT told its readers to watch for cracks in private credit. The crack it chose as its best evidence showed up in a continuation vehicle it never named as one, priced by buyers who don’t care whose fund it is or what story goes with it. That’s the argument for covering secondaries as the center of this story rather than a footnote to it: it’s the one place in private credit where the stress everyone’s talking about stops being a mark on a page and starts being a number somebody actually had to accept.
