Morgan Stanley fulfilled 43% of redemption requests for its $7 billion North Haven Private Income Fund in the second quarter after investors sought to withdraw 11.6% of the fund's units outstanding. The fund's net asset value decreased by $102 million, or 3.2%, from its March 31 level after accounting for subscriptions and dividend reinvestment. The firm indicated that roughly half of the latest redemption orders came from investors who were previously unable to fully exit.

Redemption Activity and Fund Composition

In the first quarter, investors had sought to pull roughly 10.9% from the fund. Morgan Stanley’s investment management arm pointed to steadier request patterns versus the prior quarter in a letter to investors. The firm stated that the composition and stabilization in request activity may indicate durability in the investor base.

As of May 31, the fund held loans tied to 301 borrowers spanning 45 industries. The filing disclosed the fund's software exposure at about 22.7%.

Industry-Wide Withdrawal Curbs

A smaller related vehicle, North Haven Private Income Fund A, received redemption requests equal to 7.2% of shares and planned to meet 5% under its standard limit. Other non-traded business development companies run by Apollo Global, Blackstone, and BlackRock have also curtailed withdrawals. The flagship private credit fund of Cliffwater LLC capped redemptions at 5% in the second quarter after investors sought to redeem approximately 17% of the fund’s shares.

Partners Group is restricting investor withdrawals from its $8.6 billion Global Value SICAV fund after redemption requests exceeded 5% of the net asset value. Apollo President Jim Zelter stated at a conference in New York that he expects wealthy clients to continue to seek cash back from private credit products, warning that redemption pressure could tick higher if investors try to time the limits.

Morgan Stanley announced it will increase its quarterly common stock dividend to $1.15 per share from the current $1.00 per share, beginning with the dividend expected to be declared in the third quarter of 2026. Additionally, the firm's Board of Directors reauthorized a multi-year common equity share repurchase program of up to $20 billion, effective from the third quarter of 2026. These capital allocation decisions underscore the firm's confidence in its financial strength and durable returns.

Ted Pick, Chairman and Chief Executive Officer of Morgan Stanley, stated that the firm's globally scaled business supports strong capital positions, providing the flexibility to invest in growth while increasing capital returns to shareholders. The share repurchases will be executed from time to time at prices deemed appropriate, subject to market conditions, capital position, and the economic outlook.

Capital and Regulatory Position

The Board of Governors of the Federal Reserve System released its CCAR 2026 results on June 24, 2026, which do not impact the firm's Stress Capital Buffer (SCB) requirement. The Federal Reserve expects the firm to remain subject to its current SCB requirement of 4.3% until October 1, 2027. This SCB, combined with other regulatory features, results in an aggregate U.S. Basel III Standardized Approach Common Equity Tier 1 (CET1) ratio of 11.8%. As of March 31, 2026, the firm's U.S. Basel III Standardized Approach CET1 ratio stood at 15.1%.

Key Capital Actions