By Dominiki Kraitsik
Private Credit’s Second Act: Why the Next Wave of Leaders Will Look Different
I have spent a good part of my career in rooms where a board realises, a little later than it should, that the person who built the business is not necessarily the person who should run its next chapter. Private credit has arrived at that moment, and the evidence is in the data coming out of both sides of the Atlantic.
Europe is quietly building a second banking system
The American debate about private credit tends to dominate the headlines, with its talk of redemptions, defaults and valuation. Europe’s story is different and, I would argue, more structural. A Chambers practice guide notes that bank lending still accounts for roughly 70% to 76% of corporate credit in Europe, against about 21% to 25% in the United States. That gap is the opportunity, and capital is moving into it. With Intelligence reported record European private credit fundraising of $65 billion in the first nine months of 2025, already 14% above the whole of 2024, including two mega-funds above EUR 10 billion and Ares Capital Europe VI at EUR 17.1 billion. The Financial Stability Board’s May 2026 report on private credit vulnerabilities cites average annual growth of 17% in the United Kingdom over the past five years.
Two forces are doing most of the work. The first is insurance capital: EIOPA data reported by S&P Global Market Intelligence put European insurers’ private credit exposure at 5.8% of total assets in the second quarter of 2025, the highest since 2016. The second is asset-based finance, which With Intelligence expects to challenge direct lending over time as banks continue to step back from risk. Moody’s sees global assets in the asset-backed segment exceeding $2 trillion in 2026 and approaching $4 trillion by 2030.
What links these two forces is the kind of person they require. Insurance partnerships and structured, asset-backed lending sit somewhere between credit, structuring and balance-sheet management, and that is a far scarcer skill set than the sponsor-backed origination on which most European platforms were built.
Supervisors have noticed, and that changes who sits at the table
The Bank of England’s July 2026 Financial Stability Report examines private markets and risky credit, and the Bank launched a system-wide exploratory scenario in December 2025 to test how the private markets ecosystem would hold up under stress. The European supervisory authorities’ spring 2026 joint risk update describes insurers’ exposure as limited overall but rising, and flags growing interconnectedness between private finance and banks.
For firms, questions about valuation, liquidity, leverage and linkages to banks and insurers are no longer something to hand to compliance. They determine who needs to be sitting around the leadership table, and who answers when a supervisor calls.
The wealth channel has had its first real test
For three years, semi-liquid evergreen funds were the growth story, opening private credit to private clients for the first time. Morningstar PitchBook data shows US evergreen funds at $607 billion across 567 vehicles at the end of March 2026, with direct lending the largest category at $236.5 billion. In 2026 that channel met its first serious redemption cycle.
The picture is mixed, which is precisely why leadership matters. Stanger & Co. reported that in the first quarter, non-traded BDC sponsors met around $6.9 billion of redemption requests against $4.9 billion of new capital, the first quarter in which more left these vehicles than entered them. Moody’s moved its sector outlook to negative in April, and J.P. Morgan Private Bank had already put average redemptions across the largest non-traded private credit funds at about 5% of NAV in the fourth quarter of 2025, expecting elevated activity to persist through at least the first half of 2026. Partners Group disclosed requests of roughly 9.8% of NAV in one of its private equity evergreen funds.
Yet the structures did what they were built to do. Stanger’s chairman noted record liquidity delivered and no NAV BDC gating redemptions, and alternative credit interval and tender offer funds still recorded $12.3 billion of net inflows over the twelve months to March. Most of these funds cap quarterly redemptions at around 5%, so heavy requests are a feature of the design and not a malfunction.
I find that the most interesting part of this episode is what comes next. With liquidity being provided, commentators are already pointing to NAV per share as the thing investors will scrutinise. Whether a product survives that scrutiny depends less on how it was engineered than on the people who explain it, set the liquidity policy and hold the relationships with advisors and platforms. In every earlier cycle I have seen in semi-liquid products, the firms that kept advisor confidence were those whose leaders spoke early and plainly, and who had agreed in advance how liquidity would be managed before requests spiked.
Five profiles we are seeing in demand
Croft & Co, a European search firm, argues that private credit briefs in 2026 read less like fund mandates and more like the credit division of a bank, and that workout experience gained inside a lender is the hardest profile to find in Europe. RCQ Associates reports a rise of more than 30% in clients seeking structuring and product talent in collateralised fund obligations. Drawing these threads together with our own conversations in the market, five profiles stand out:
- Heads of asset-based finance and structured credit, able to originate and structure across consumer, specialty finance and data infrastructure assets.
- Insurance-capital partnership leaders, who combine an understanding of assets and liabilities with credit judgement and speak the language of both insurer and manager.
- Portfolio monitoring and workout leaders whose experience comes from inside a lender, not only from an advisory seat.
- Risk, valuation and regulatory-facing leaders, comfortable engaging supervisors and withstanding stress-test scrutiny.
- Pan-European origination leaders with credible sponsor relationships across several jurisdictions and languages.
On the wealth side, the leaders who stand out combine liquidity governance, valuation credibility, advisor relationships that have been tested in a downturn, and the ability to bridge institutional and private wealth capital fairly. Few executives have run a semi-liquid product through a full redemption cycle. The strongest tend to come from the earlier non-traded real estate wave, from distribution platforms that understand the advisor’s side, or from liquidity and risk functions. This is our reading of the market and not a formula, and the best appointments usually combine two of these backgrounds.
What I would do now, if I were on your board
- Audit your leadership against the regulatory agenda. Ask who answers when a supervisor asks about valuation, leverage or insurer linkages, and who speaks to advisors if redemption requests double next quarter.
- Decide where you want to be on the asset-based finance curve. Building the capability internally takes longer than most plans assume, and team lift-outs are a recurring option.
- Think pan-European from the start. Compensation, regulation and candidate pools differ by centre, and a London-only search narrows the field.
- Separate the sales mandate from the stewardship mandate in your wealth channel, and align incentives with retention, not only inflows.
- Start the conversation early. The profiles above are rarely on the open market, and a confidential search takes months.
