black stone president Jon Gray The loan quality of the firm’s flagship private credit fund was defended on Tuesday after investors withdrew nearly 8% of their capital last quarter.

The alternative asset management giant said late Monday Archive It allows investors to withdraw 7.9% of BCRED, which it calls the largest private credit funds Global investment is approximately US$82 billion. Blackstone did this in part by allowing the company’s own investors to put $150 million into the fund.

The move triggered a sell-off in Blackstone shares, as well as those of other private credit peers, with the company’s shares falling about 8.5% in early trading on Tuesday.

“Taking credit quality into consideration, the 400-plus borrowers here grew their EBITDA by 10% last year,” Gray told CNBC. David Fabera term used to refer to a company’s financial performance. “So when we saw this, we felt really good.”

Rather than calming markets, recent moves by alternative asset managers to allow investors to cash out of funds have intensified volatility. Add only Tensions surrounding private credit and software industry loans. The storm intensified last month when Blue Owl said it had found a buyer for part of a $1.4 billion loan. Help cash out 30% of distressed credit funds.

Now, worries about private credit appear to be broadening as Blackstone Group, a much larger asset manager, becomes involved.

A Blackstone spokesperson said the company and its employees invested in BCRED “to meet 100% of requirements for the quarter with certainty and timeliness.”

The fund has returned an annualized rate of 9.8% since the Class I shares were created, the spokesperson said.

“We’re hearing a lot of noise,” Gray told CNBC. “You know better than anyone in the media that this has become a story.”

Concerns first arose last fall as banks collapsed. three colors and No. 1 brandBlackstone executives noted that these companies also receive funding from banks.

“There is an ongoing spin cycle, so it’s no surprise that investors get nervous when this happens,” Gray said. “A financial advisor can say, ‘Hey, I want to redeem.'”

Still, loans to software companies remain BCRED’s largest single exposure, accounting for about 25% of the fund, according to the disclosure.

While Gray acknowledged that “some software companies will be disrupted by artificial intelligence” in the coming years, he also noted that creditors outrank shareholders and many software companies will be difficult to evict.

“There’s an environment right now where there’s a disconnect between what’s actually happening in the underlying portfolio and what’s happening in the news cycle,” Gray said. “Ultimately, these things will work themselves out.”