Private credit’s golden era never really ended – Blackstone’s Michael Zawadzki

Volatility creates opportunity, Michael Zawadzki, global CIO of Blackstone Credit & Insurance, told host Lisa Lee on the Credit Exchange podcast.

“Stick with the fundamentals that have been working for us and look to play offense where volatility creates opportunity,” said Zawadzki. In the seven or eight days following the 2 April tariff announcement, Blackstone traded over USD 5 billion of liquid credit.

“When we see prices on the screen disconnect from underlying fundamentals, that's a time where you want to lean in,” he advised.

“It doesn't mean you need to lean in with and push all of your chips into the centre of the table, but it does mean you can start buying with the expectation that you’ll add more into further weakness.”

Private credit’s golden era never really ended. The period in 2023 when base rates were high and spreads were wide, and all deals coming to private was a really attractive market for private credit. Fast forward to today – Zawadzki predicts that they can see a repeat, getting deals that would otherwise have accessed the public market. In addition, private credit will maintain a durable 150bp to 200bp premium to the public markets and expand its reach to around a USD 30 trillion market, of which the bulk will be investment-grade private credit.

Blackstone is also having more discussions around the place for European assets in its client portfolios, Zawadzki said.